Document And Entity Information
Document And Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Mar. 31, 2017 | Jun. 30, 2016 | |
Document and Entity Information | |||
Entity Registrant Name | CLEAN DIESEL TECHNOLOGIES INC | ||
Document Type | 10-K | ||
Current Fiscal Year End Date | --12-31 | ||
Amendment Flag | false | ||
Entity Central Index Key | 949,428 | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Well-known Seasoned Issuer | No | ||
Document Period End Date | Dec. 31, 2016 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Entity Public Float | $ 6,460,563 | ||
Entity Common Stock, Shares Outstanding | 15,703,301 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash | $ 7,839 | $ 2,958 |
Accounts receivable, net | 5,398 | 4,255 |
Inventories | 7,125 | 7,918 |
Prepaid expenses and other current assets | 968 | 1,568 |
Total current assets | 21,330 | 16,699 |
Property and equipment, net | 1,158 | 1,538 |
Intangible assets, net | 1,483 | 1,901 |
Goodwill | 0 | 4,659 |
Deferred tax asset | 554 | 0 |
Other assets | 305 | 305 |
Total assets | 24,830 | 25,102 |
Current liabilities: | ||
Line of credit | 1,458 | 3,513 |
Shareholder notes payable | 1,803 | 0 |
Accounts payable | 5,979 | 5,012 |
Accrued expenses and other current liabilities | 6,345 | 7,854 |
Income taxes payable | 642 | 534 |
Total current liabilities | 16,227 | 16,913 |
Shareholder notes payable, noncurrent | 0 | 7,559 |
Deferred tax liability | 0 | 193 |
Total liabilities | 16,227 | 24,665 |
Commitments and contingencies (Note 17) | ||
Stockholders' equity: | ||
Preferred stock, par value $0.01 per share: authorized 100,000; no shares issued and outstanding | 0 | 0 |
Common stock, par value $0.01 per share: authorized 50,000,000 and 4,800,000 at December 31, 2016 and 2015, respectively; issued and outstanding 15,703,301 and 3,559,530 shares at December 31, 2016 and 2015, respectively | 157 | 36 |
Additional paid-in capital | 237,838 | 205,377 |
Accumulated other comprehensive loss | (6,329) | (5,387) |
Accumulated deficit | (223,063) | (199,589) |
Total stockholders' equity | 8,603 | 437 |
Total liabilities and stockholders' equity | $ 24,830 | $ 25,102 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Preferred stock par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 100,000 | 100,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 50,100,000 | 24,000,000 |
Common stock, shares issued (in shares) | 15,703,301 | 3,559,530 |
Common stock, shares outstanding (in shares) | 15,703,301 | 3,559,530 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Income Statement [Abstract] | ||
Total revenues | $ 36,839 | $ 39,738 |
Cost of revenues | 28,773 | 28,846 |
Gross profit | 8,066 | 10,892 |
Operating expenses: | ||
Research and development | 4,657 | 7,826 |
Selling, general and administrative | 11,837 | 11,903 |
Goodwill impairment | 4,675 | 0 |
Severance and other charges | 2,555 | 1,482 |
Total operating expenses | 23,724 | 21,211 |
Loss from continuing operations | (15,658) | (10,319) |
Other (expense) income: | ||
Interest expense, net | (1,535) | (1,166) |
Gain on change in fair value of bifurcated derivative liability | 2,754 | 0 |
Loss on extinguishment of convertible debt | (12,410) | 0 |
Gain on change in fair value of liability-classified warrants | 1,554 | 2,617 |
Other income, net | 863 | 47 |
Total other (expense) income | (8,774) | 1,498 |
Loss from continuing operations before income tax benefit | (24,432) | (8,821) |
Income tax benefit from continuing operations | (958) | (399) |
Net loss from continuing operations | (23,474) | (8,422) |
Net loss from discontinued operations | 0 | (112) |
Net loss | (23,474) | (8,534) |
Foreign currency translation adjustments | (942) | (2,522) |
Comprehensive loss | $ (24,416) | $ (11,056) |
Basic and diluted net loss per share: | ||
Net loss from continuing operations (in dollars per share) | $ (3.84) | $ (2.67) |
Net loss from discontinued operations (in dollars per share) | 0 | (0.04) |
Net loss (in dollars per share) | $ (3.84) | $ (2.71) |
Weighted-average number of common shares outstanding—basic and diluted (in shares) | 6,107 | 3,151 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders` Equity - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Loss | Accumulated Deficit |
Balance at Dec. 31, 2014 | $ 6,993 | $ 28 | $ 200,885 | $ (2,865) | $ (191,055) |
Balance (in shares) at Dec. 31, 2014 | 2,831,000 | ||||
Increase (decrease) in stockholders' equity | |||||
Net loss | (8,534) | (8,534) | |||
Foreign currency translation adjustment | (2,522) | (2,522) | |||
Proceeds from equity offerings, net of costs | 3,731 | $ 7 | 3,724 | ||
Proceeds from equity offerings, net of costs (in shares) | 677,000 | ||||
Restricted stock unit vesting | 2 | $ 1 | 1 | ||
Restricted stock unit vesting (in shares) | 52,000 | ||||
Stock-based compensation | 767 | 767 | |||
Balance at Dec. 31, 2015 | $ 437 | $ 36 | 205,377 | (5,387) | (199,589) |
Balance (in shares) at Dec. 31, 2015 | 3,559,530 | 3,560,000 | |||
Increase (decrease) in stockholders' equity | |||||
Net loss | $ (23,474) | (23,474) | |||
Foreign currency translation adjustment | (942) | (942) | |||
Issuance of stock for settlement of accounts payable | 184 | $ 1 | 183 | ||
Issuance of stock for settlement of accounts payable (in shares) | 81,000 | ||||
Proceeds from equity offerings, net of costs | 9,343 | $ 56 | 9,287 | ||
Proceeds from equity offerings, net of costs (in shares) | 5,662,000 | ||||
Issuance of common stock on conversion of debt | 20,038 | $ 60 | 19,978 | ||
Issuance of common stock on conversion of debt (in shares) | 5,961,000 | ||||
Exercise of warrants | 1,386 | $ 4 | 1,382 | ||
Exercise of warrants (in shares) | 411,000 | ||||
Restricted stock unit vesting | 0 | $ 0 | |||
Restricted stock unit vesting (in shares) | 28,000 | ||||
Stock-based compensation | 1,631 | 1,631 | |||
Balance at Dec. 31, 2016 | $ 8,603 | $ 157 | $ 237,838 | $ (6,329) | $ (223,063) |
Balance (in shares) at Dec. 31, 2016 | 15,703,301 | 15,703,000 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Cash flows from operating activities: | ||
Net loss | $ (23,474) | $ (8,534) |
Net loss from discontinued operations | 0 | 112 |
Adjustments to reconcile net loss to cash used in operating activities: | ||
Depreciation and amortization | 780 | 924 |
Stock-based compensation expense | 1,631 | 767 |
Gain on change in fair value of liability-classified warrants | (1,554) | (2,617) |
Gain on change in fair value of bifurcated derivative liability | (2,754) | 0 |
Loss on extinguishment of convertible debt | 12,410 | 0 |
Gain on foreign currency transactions | (965) | (718) |
Amortization of debt discount | 460 | 0 |
Impairment of goodwill | 4,675 | 0 |
Offering costs | 0 | 833 |
Other | 150 | (256) |
Changes in operating assets and liabilities: | ||
Accounts receivable | (1,124) | (1,705) |
Inventories | 965 | (2,483) |
Prepaid expenses and other assets | 571 | (294) |
Accounts payable, accrued expenses and other current liabilities | 1,894 | 2,790 |
Income taxes | (669) | 312 |
Cash used in operating activities of continuing operations | (7,004) | (10,869) |
Cash used in operating activities of discontinued operations | 0 | (712) |
Net cash used in operating activities | (7,004) | (11,581) |
Cash flows from investing activities: | ||
Purchases of property and equipment | (146) | (661) |
Proceeds from sale of property, equipment and other assets | 79 | 208 |
Net cash used in investing activities | (67) | (453) |
Cash flows from financing activities: | ||
Net payments under demand line of credit | (2,055) | 671 |
Proceeds from issuance of common stock and warrants, net of offering costs | 10,200 | 7,115 |
Proceeds from exercise of warrants | 240 | 0 |
Proceeds from debt offerings | 3,750 | 0 |
Net cash provided by financing activities | 12,135 | 7,786 |
Effect of exchange rates on cash | (183) | (14) |
Net change in cash | 4,881 | (4,262) |
Cash at beginning of year | 2,958 | |
Cash at end of year | $ 7,839 | $ 2,958 |
Description of Business
Description of Business | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure Text Block [Abstract] | |
Description of Business | Description of Business Clean Diesel Technologies, Inc. ("CDTi" or the "Company") is a leading provider of technology and solutions to the automotive emissions control markets. The Company possesses market leading expertise in emissions catalyst design and engineering for automotive and off-road applications The Company is transitioning its business from being a niche manufacturer of emissions control solutions for the automotive and heavy duty diesel markets to becoming an advanced materials technology provider for these markets. The Company has a proven ability to develop proprietary materials incorporating various base metals that replace costly platinum group metals ("PGMs") in coatings on vehicle catalytic converters. Recently, the Company has expanded its materials platform to include new synergized-PGM diesel oxidation catalysts (SPGM ™ DOC), Base-Metal Activated Rhodium Support (BMARS ™ ), and Spinel™ technologies, and it is in the process of introducing these new catalyst technologies to OEMs and other vehicle catalyst manufacturers in a proprietary powder form. The Company believes that this powder-to-coat business model will allow it to achieve greater scale and higher return on its technology investment than in the past. The Company's business is driven by increasingly stringent global emission standards for internal combustion engines, which are major sources of a variety of harmful pollutants. It has operations in the United States ("U.S."), Canada, the United Kingdom, France, Japan and Sweden as well as an Asian investment. |
Liquidity and Going Concern
Liquidity and Going Concern | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Liquidity and Going Concern | Liquidity and Going Concern The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern. Therefore, the consolidated financial statements contemplate the realization of assets and liquidation of liabilities in the ordinary course of business. The Company has suffered recurring losses and negative cash flows from operations since inception, resulting in an accumulated deficit of $223.1 million at December 31, 2016 . The Company has funded its operations through asset sales, credit facilities and other borrowings and equity sales. At December 31, 2016 , the Company had $7.8 million in cash. The Company’s continuation as a going concern is dependent upon its ability to obtain adequate financing, which the Company has successfully secured since inception, including financing from equity sales and asset divestitures. However, there is no assurance that the Company will be able to achieve projected levels of revenue and maintain access to sufficient working capital, and accordingly, there is substantial doubt as to whether the Company’s existing cash resources and working capital are sufficient to enable it to continue its operations within one year from the financial statement issuance date. The Company is currently working towards obtaining a new credit facility that would provide the Company the flexibility it needs as it implements its new business strategy. If the Company is unable to obtain the necessary capital, it will be forced to license or liquidate its assets, significantly curtail or cease its operations and/or seek reorganization under the U.S. Bankruptcy Code. The Company has a $7.5 million secured demand facility backed by its receivables and inventory with Faunus Group International, Inc. ("FGI"). At December 31, 2016 , the Company had $1.5 million in borrowings outstanding under this facility with $6.0 million available, subject to the availability of eligible accounts receivable and inventory balances for collateral. There is no guarantee that the Company will be able to borrow to the full limit of $7.5 million if FGI chooses not to finance a portion of its receivables or inventory. Additionally, FGI can cancel the facility at any time. For additional information, refer to Note 10 , " Debt ". On May 19, 2015, the Company filed a shelf registration statement on Form S-3 with the SEC, which was declared effective on November 17, 2015. The Form S-3 permits the Company to sell in one or more registered transactions up to an aggregate of $50.0 million of various securities not to exceed one-third of the Company’s public float in any 12 -month period. As of December 31, 2016 , the Company had sold an aggregate of $3.1 million using the Form S-3. During the twelve months ended December 31, 2016 , the Company entered into the following agreements or made amendments to existing debt in order to address cash requirements and improve the Company’s capital structure: · April 1, 2016 Kanis Promissory Note: Kanis S.A agreed to lend the Company $2.0 million at 8% per annum. · April 1, 2016 Kanis Amendment to Loan Agreement: The Company amended all prior conversion rights in the $7.5 million Kanis loan agreement to provide Kanis the right to convert the loan and accrued interest at $3.60 or market price. The amendment further allowed the Company to mandatorily convert the loan and accrued interest upon a Liquidity Event at a discount of 25% below the Liquidity Event price. · April 11, 2016 Bell Director Note: Lon E. Bell, Ph.D. one of the Company’s directors, agreed to lend the Company $0.5 million at 8% per annum. · June 30, 2016 Kanis Exchange Agreement: Kanis S.A agreed to an exchange of $7.5 million in principal plus accrued interest for shares of the Company’s common stock, conditional upon receipt of shareholder approval. · June 30, 2016 Bell Exchange Agreement: Dr. Bell agreed to an exchange of $0.5 million in principal plus accrued interest for shares of the Company’s common stock, conditional upon receipt of shareholder approval. · June 30, 2016 Haldor Topsøe Convertible Notes: The Company agreed to sell and issue (i) a Senior Convertible Promissory Note in the principal amount of $0.75 million and a Convertible Promissory Note in the principal amount of $0.5 million , each of which is convertible into the Company’s equity securities. On August 25, 2016, the Company’s shareholders approved debt conversion transactions with Kanis S.A. and Lon E. Bell. Combined with the conversion of convertible debt held by Haldor Topsøe A/S, the Company issued approximately 5.5 million shares of common stock in exchange for the extinguishment of approximately $8.9 million of total indebtedness. On November 3, 2016, the Company entered into a securities purchase agreement with institutional and individual accredited investors and certain of its officers and directors to raise gross proceeds of approximately $10.3 million in a private placement of common stock at a per-share price of $2.00 . The offering was consummated in two closings. The initial closing for 949,960 shares of common stock, for gross proceeds of approximately $1.9 million , was completed on November 4, 2016. The second closing for approximately 4.2 million shares, for gross proceeds of approximately $8.4 million , was completed on December 16, 2016. The Company paid approximately $0.1 million of transaction costs related to the equity offerings. In addition, the Company issued common stock and warrants to the placement agent of the equity offering as payment for their services (see Note 11 for further information). In addition, on December 16, 2016, Haldor Topsoe elected to convert the Senior Note, and issued to Haldor Topsøe and aggregate of 462,535 shares of common stock in conversion of $0.75 million in principal amount of indebtedness. The Company intends to use the net proceeds from the offering for general corporate purposes, including, but not limited to, working capital, general and administrative expenses, capital expenditures, implementation of strategic priorities, and other corporate uses. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Significant Accounting Policies Principles of Consolidation The consolidated financial statements include the financial statements of the Company and its wholly owned subsidiaries. All intercompany transactions, including intercompany profits and losses and intercompany balances, have been eliminated in consolidation. Discontinued Operations When the Company commits to a plan to dispose of a component of the Company or a group of components of the Company, it is required to be reported in discontinued operations if the disposal represents a strategic shift that has (or will have) a major effect on the Company's operations and financial results when certain events have occurred as defined by ASU 2014-08 "Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity." A business' operations are classified as discontinued operations for all periods that would be presented. In the statements of cash flows, the cash flows of discontinued operations are separately classified and aggregated. Discontinued operations includes accruals and related costs for the Company's estimated liability to settle its ongoing indemnification matters with Johnson Matthey ("JM") associated with the sale of Applied Utility Systems, Inc. ("AUS"), a former subsidiary of the Company, in 2009. For additional information, refer to Note 21 , " Discontinued Operations ". All discussions and amounts in the consolidated financial statements and related notes for all periods presented relate to continuing operations only, unless otherwise noted. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the U.S requires management of the Company to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent liabilities. These estimates and assumptions are based on management's best estimates and judgment. On an ongoing basis, the Company evaluates its estimates and assumptions, including those related to impairment of goodwill and long-lived assets, stock-based compensation, the fair value of financial instruments including warrants, allowance for doubtful accounts, inventory valuation, taxes and contingent and accrued liabilities. The Company bases its estimates on historical experience and various other factors, including the current economic environment, which it believes to be reasonable under the circumstances. Estimates and assumptions are adjusted when facts and circumstances dictate. Actual results may differ from these estimates under different assumptions and conditions. Management believes that the estimates are reasonable. Cash Cash consists of cash balances on hand and on deposit at banks. Cash on deposit at banks at times may exceed the Federal Deposit Insurance Corporation (FDIC) limits. The Company believes no significant concentration of credit risk exists with respect to these cash balances. Accounts Receivable Accounts receivable are recorded at the invoiced amount and do not bear interest. Accounts receivable are presented net of a reserve for doubtful accounts of $0.4 million and $0.3 million at December 31, 2016 and 2015 , respectively. The allowance for doubtful accounts is the Company's best estimate of the amount of probable credit losses in the Company's existing accounts receivable. The Company determines the allowance based on historical write-off experience and past due balances over 90 days that are reviewed individually for collectability. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off balance sheet credit exposure related to its customer. Inventories Inventories are stated at the lower of cost (FIFO method) or market (net realizable value). Finished goods inventory includes materials, labor and manufacturing overhead. The Company establishes provisions for inventory that is obsolete or when quantities on hand are in excess of estimated forecasted demand. The creation of such provisions results in a write-down of inventory to net realizable value and a charge to cost of sales. The Company's inventory includes precious metals (platinum, palladium and rhodium) for use in the manufacturing of catalysts. The precious metals are valued at the lower of cost or market, consistent with the Company's other inventory. Property and Equipment Property and equipment is capitalized at cost and is stated at cost less accumulated depreciation and amortization. Depreciation and amortization is determined using the straight line method over the estimated useful lives of the various asset classes. Machinery and equipment are depreciated over 2 to 10 years; furniture and fixtures, computer hardware and software and vehicles are depreciated over 2 to 5 years. Property and equipment held under capital leases and leasehold improvements are amortized over the shorter of estimated useful lives or the lease term. Repairs and maintenance are charged to expense as incurred and major replacements or betterments are capitalized. Goodwill and Intangible Assets Goodwill is the excess of the purchase price of an acquired entity over the fair value of net identified tangible and intangible assets acquired and is recorded in the reporting unit (operating segment or one level below operating segment) that is expected to benefit from the business combination. Goodwill is not amortized, but rather tested for impairment at least annually or more often whenever events or circumstances indicate that goodwill might be impaired. The Company performs its annual impairment test as of October 31. Goodwill is tested at the reporting unit level using a two-step impairment test. The first step is to compare the fair value of the reporting unit to its carrying value, including goodwill. If the carrying value of the reporting unit exceeds the fair value, a second step is performed in order to determine the amount of impairment loss, if any. The second step compares the implied fair value of the reporting unit's goodwill with the carrying amount of that goodwill. If the carrying amount of the reporting unit's goodwill exceeds its implied fair value, an impairment charge is recognized in an amount equal to that excess. Prior to performing the two-step impairment test, the Company may make a qualitative assessment of the likelihood of goodwill impairment in order to determine whether a detailed quantitative analysis is required. The Company's Engine Control Systems reporting unit, contains all of the Company's allocated goodwill. See note 15 for further discussion of the impairment which occurred in 2016. The Company's intangible assets consist of trade names, acquired patents and technology, and customer relationships and have finite lives. Intangible assets are carried at cost, less accumulated amortization. Amortization is computed on a straight-line or accelerated basis over the estimated useful lives of the respective assets, ranging from 4 to 20 years. Long Lived Assets Assets such as property and equipment and amortizable intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment loss is recognized when the sum of the expected undiscounted future net cash flows of an asset or asset group is less than its carrying amount and is measured as the amount by which the carrying amount of the asset or asset group exceeds its fair value. Warrants and Derivative Liabilities The Company accounts for the issuance of Company derivative equity instruments in accordance with Accounting Standards Codification ("ASC") 815-40 "Derivative and Hedging". The Company reviews common stock purchase warrants at each balance sheet date based upon the characteristics and provision of each particular instrument and classifies them on the balance sheet as equity or a liability. Below are some of the factors the Company considers with the corresponding balance sheet classification: • Equity if the awards (i) require physical settlement or net-share settlement, or (ii) give the Company a choice of net-cash settlement or settlement in the Company's own shares (physical settlement or net-share settlement), or as • Liabilities if the awards (i) require net-cash settlement (including a requirement to net-cash settle the contract if an event occurs and if that event is outside the Company's control), or (ii) give the counterparty a choice of net-cash settlement or settlement in shares (physical settlement of net-share settlement). The Company assesses classification of common stock purchase warrants and other freestanding derivatives at each reporting date to determine whether a change in classification between assets and liabilities and equity is required. Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis and operating loss and tax credit carryforwards. 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 includes the enactment date. A valuation allowance against deferred tax assets is required if, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The valuation allowance should be sufficient to reduce the deferred tax assets to the amount that is more likely than not to be realized. The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Changes in recognition or measurement are reflected in the period in which the change occurs. The Company records interest and penalties related to unrecognized tax benefit in income tax expense. Revenue Recognition Revenues are derived primarily from the sale of products. The Company generally recognizes revenue when products are shipped and the customer takes ownership and assumes risk of loss, collection of the relevant receivable is reasonably assured, persuasive evidence of an arrangement exists and the sales price is fixed or determinable. There are certain customers where risk of loss transfers at destination point and revenue is recognized when product is delivered to the destination. For these customers, revenue is recognized upon receipt at the customer's warehouse. When terms of sale include subjective customer acceptance criteria, the Company defers revenue until the acceptance criteria are met. The determination of whether or not the customer acceptance terms are perfunctory or inconsequential impacts the amount and timing of the revenue recognized. Research and Development Research and development costs are generally expensed as incurred. These expenses include the salary and benefits for the research and development staff as well as travel, research materials, testing and legal expense related to patenting intellectual property. Also included is any depreciation related to assets utilized in the development of new products. Stock-Based Compensation Equity awards consist of stock options and restricted stock units ("RSUs"). The Company measures the compensation cost for all stock-based awards at fair value on the date of grant and recognizes it on a straight-line basis over the service period for awards expected to vest, which is generally three years. The Company measures the fair value of stock options using the Black-Scholes option-pricing model and certain assumptions, including the expected life of the stock options, an expected forfeiture rate and the expected volatility of its common stock. The fair value of RSUs is based on the closing price of the Company's common stock on the grant date. Product Warranty The Company provides for the estimated cost of product warranties in cost of sales, at the time product revenue is recognized. Warranty costs are estimated primarily using historical warranty information in conjunction with current engineering assessments applied to the Company's expected repair or replacement costs. Foreign Currency The functional currency of the Heavy Duty Diesel Systems division's Engine Control Systems Limited subsidiary in Canada is the Canadian dollar, while that of its subsidiary Engine Control Systems Europe AB in Sweden is the Swedish krona and the division's Clean Diesel Technologies Limited U.K. subsidiary, is the British pound sterling. The functional currency of the Catalyst division's Japanese branch office and Asian investment is the Japanese Yen. Accordingly, the assets and liabilities of the foreign locations are translated into U.S. dollars at period-end exchange rates. Revenue and expense accounts are translated at the average exchange rates for the period. The resulting foreign currency exchange adjustments are charged or credited directly to other comprehensive income or loss as a separate component of stockholders' equity. Unrealized foreign currency exchange gains and losses on certain intercompany transactions that are of a long-term investment nature (i.e. settlement is not planned or anticipated in the foreseeable future) are also recorded in other comprehensive income or loss in stockholders' equity. Accumulated other comprehensive loss contained only foreign currency translation adjustments as of December 31, 2016 and 2015 . The Company has exposure to multiple currencies. The primary exposure is between the U.S. dollar, the Canadian dollar, the Euro, British pound sterling and Swedish krona. Gains and losses arising from transactions denominated in currencies other than the functional currency of the entity are included in other income (expense) in the consolidated statements of comprehensive loss. Gains and losses arising from transactions denominated in foreign currencies are primarily related to inter-company loans that have been determined to be temporary in nature, cash, accounts receivable and accounts payable denominated in non-functional currencies. Net Loss per Share Basic net loss per share is computed using the weighted average number of common shares outstanding during the period. Diluted net loss per share is computed using the weighted average number of common shares and dilutive potential common shares. Dilutive potential common shares include employee stock options, RSUs, warrants and debt that are convertible into the Company's common stock. Diluted net loss per share excludes certain dilutive potential common shares outstanding as their effect is anti-dilutive. Because the Company incurred net losses in the years ended December 31, 2016 and 2015 , the effect of potentially dilutive securities has been excluded in the computation of net loss per share as their impact would be anti-dilutive. Potentially dilutive common stock equivalents excluded were 2.1 million and 1.2 million shares during the years ended December 31, 2016 and 2015 , respectively. Fair Value Measurements Fair value is defined as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset and liability. As a basis for considering such assumptions, a fair value hierarchy has been established that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurement) and the lowest priority to unobservable inputs (level 3 measurements). The three levels of the fair value hierarchy are as follows: • Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities; • Level 2: Inputs other than quoted prices included within Level 1 that are either directly or indirectly observable including quoted prices for similar instruments in active markets and quoted prices for identical or similar instruments in markets that are not active; and • Level 3: Unobservable inputs in which little or no market activity exists, therefore requiring an entity to develop its own assumptions about the assumptions that market participants would use in pricing. Fair Value of Financial Instruments ASC Topic 825, "Financial Instruments", requires disclosure of the fair value of financial instruments for which the determination of fair value is practicable. The fair values of the Company's cash, trade accounts receivable, prepaid expenses and other current assets, accounts payable and accrued expenses and other current liabilities approximate carrying values due to the short maturity of these instruments. The fair value of borrowings under the line of credit approximates their carrying value due to the variable interest rates. The fair value of shareholder notes payable, calculated using level 3 inputs, and a net present value model, was $1.8 million and $7.6 million at December 31, 2016 and 2015 , respectively. The fair value for the warrants classified as liability and the bifurcated derivative liabilities were calculated using level 3 inputs, including Black-Scholes option-pricing model as well as Monte Carlo Simulation model. These inputs are disclosed in Note 13 "Fair Value Measurements" Reclassifications Certain prior-period amounts have been reclassified to conform to the current period presentation. These changes had no impact on the previously reported consolidated results of operations or stockholders' equity. The Company had been transitioning from a niche manufacturer of emission control solutions for the automotive and heavy duty diesel markets to becoming an advanced materials technology provider for these markets. During the second quarter of 2016, the transition of the operational strategy was completed and the Company now views its operations and measures its business as one reportable segment. As a result, all segment disclosure has been modified to reflect the current year presentations. Recently Issued Accounting Guidance In May 2014, the Financial Accounting Standards Board ("FASB") issued ASU No. 2014-9, "Revenue from Contracts with Customers (Topic 606)". ASU No. 2014-9 supersedes the revenue recognition requirements in "Revenue Recognition (Topic 605)". ASU No. 2014-9 requires entities to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. In July 2015, the FASB finalized the delay of the effective date by one year, making the new standard effective for interim periods and annual periods beginning after December 15, 2017. Early adoption is permitted, but it is not permitted earlier than the original effective date. ASU No. 2014-9 provides for either full retrospective adoption or a modified retrospective adoption by which it is applied only to the most current period presented. While the Company has not finalized the impact of the adoption of ASU No. 2014-9 on its consolidated financial statements, the Company does not expect the adoption to have a material impact. In August 2014, the FASB issued ASU No. 2014-15, "Presentation of Financial Statements-Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern". ASU No. 2014-15 defines management's responsibility to assess an entity's ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. It is effective for annual reporting periods ending after December 15, 2016, and for annual and interim reporting periods thereafter. Early adoption is permitted. The Company has elected to early adopt the provision and has provided the appropriate disclosure in Note 2. In April 2015, the FASB issued ASU No. 2015-03, " Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs" which requires companies to present debt issuance costs the same way they currently present debt discounts, as a direct deduction from the carrying value of that debt liability. ASU No. 2015-03 does not impact the recognition and measurement guidance for debt issuance costs. The provisions in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015. Early adoption is allowed for all entities for financial statements that have not been previously issued. Entities would apply the new guidance retrospectively to all prior periods (i.e., the balance sheet for each period is adjusted). The adoption of this provision did not have a material impact on the consolidated financial statements. In July 2015, the FASB issued ASU No. 2015-11, "Inventory (Topic 330): Simplifying the Measurement of Inventory". ASU No. 2015-11 changes the measurement principle for inventory from the "lower of cost or market" to "lower of cost and net realizable value." Net realizable value is defined as the "estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation." ASU No. 2015-11 eliminates the guidance that entities consider replacement cost or net realizable value less an approximately normal profit margin in the subsequent measurement of inventory when cost is determined on a first-in, first-out or average cost basis. It is effective for annual reporting periods beginning after December 15, 2016, including interim periods within those fiscal years. Early adoption is permitted. The Company has not yet determined whether it will elect to early adopt ASU No. 2015-11, and it is currently in the process of evaluating the impact of the adoption of ASU No. 2015-11 on its consolidated financial statements. In January 2016, FASB issued ASU No. 2016-1, "Recognition and Measurement of Financial Assets and Financial Liabilities". ASU No. 2016-1 requires equity investments to be measured at fair value with changes in fair value recognized in net income; simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment; eliminates the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet; requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes; requires an entity to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments; requires separate presentation of financial assets and financial liabilities by measurement category and form of financial assets on the balance sheet or the accompanying notes to the financial statements and clarifies that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity's other deferred tax assets. ASU No. 2016-1 is effective for financial statements issued for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The Company is currently in the process of evaluating the impact of the adoption of ASU No. 2016-1 on its consolidated financial statements. In February 2016, the FASB issued ASU 2016-2, "Leases (Topic 842)." ASU No. 2016-2 requires the recognition of lease assets and lease liabilities by lessees for those leases classified as operating leases under previous U.S. generally accepted accounting principles. It is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. Entities are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The Company is evaluating the impact of adoption of ASU No. 2016-2 on its consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, “Compensation - Stock Compensation: Improvements to Employee Share-Based Payment Accounting”. ASU No. 2016-09 will change how companies account for certain aspects of share-based payments to employees. Entities will be required to recognize the income tax effects of awards in the statement of income when the awards vest or are settled, the guidance on employers’ accounting for an employee’s use of shares to satisfy the employer’s statutory income tax withholding obligation and for forfeitures is changing and the update requires companies to present excess tax benefits as an operating activity on the statement of cash flows rather than as a financing activity. ASU No. 2016-09 is effective for annual periods beginning after December 15, 2016 and interim periods within those annual periods. Early adoption is permitted. The Company adopted ASU No. 2016-09 in the first quarter of 2017. The adoption of this provision did not have a material impact on its consolidated financial statements. In August 2016, the FASB issued ASU 2016-15, “Classification of Certain Cash Receipts and Cash Payments: a consensus of the Emerging Task Force.” ASU 2016-15 provides guidance on how certain cash receipts and payments are presented and classified in the statement of cash flows, including debt prepayment or debt extinguishment costs, contingent consideration payments made after a business combination, and separately identifiable cash flows and application of the predominance principle. The standard is intended to reduce current diversity in practice. The standard will be effective for annual reporting periods beginning after December 15, 2017, including interim periods within those reporting periods. Early adoption is permitted. The Company has not yet evaluated the impact of the adoption of this accounting standard update on its consolidated financial statements. In October 2016, the FASB issued ASU 2016-16, “Intra-Entity Transfers of Assets of Other Than Inventory.” Current GAAP prohibits the recognition of current and deferred income taxes for an intra-entity asset transfer until the asset has been sold to an outside party. ASU 2016-16 updates the current guidance by requiring that entities recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. The amendments in this ASU do not change GAAP for the pre-tax effects of an intra-entity asset transfer under Topic 810, Consolidation, or for the income tax effects of an intra-entity transfer of inventory. The standard will be effective for annual reporting periods beginning after December 15, 2017, including interim periods within those reporting periods. Early adoption is permitted. The Company is currently evaluating the impact of the adoption of this accounting standard on its consolidated financial statements. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consist of the following (in thousands): December 31, 2016 2015 Raw materials $ 3,291 $ 3,894 Work in process 790 844 Finished goods 3,044 3,180 $ 7,125 $ 7,918 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment Property and equipment consists of the following (in thousands): December 31, 2016 2015 Buildings and improvements $ — $ 195 Furniture and fixtures 2,124 2,248 Computer hardware and software 1,228 1,370 Machinery and equipment 11,078 11,961 Vehicles 31 86 14,461 15,860 Less accumulated depreciation (13,303 ) (14,322 ) $ 1,158 $ 1,538 Depreciation expense was $0.3 million and $0.4 million for the years ended December 31, 2016 and 2015 , respectively. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill The balance of goodwill as of December 31, 2016 and 2015 was $0.0 million and $4.7 million . In connection with the annual impairment analysis performed during the fourth quarter, the Company recognized an impairment charge of $4.7 million (see Note 15 for further details). Intangible Assets Intangible assets consist of the following (in thousands): Useful Life December 31, 2016 2015 Trade name 15 - 20 $ 1,204 $ 1,186 Patents and know-how 5 - 12 4,090 4,002 Customer relationships 4 - 8 721 724 6,015 5,912 Less accumulated amortization (4,532 ) (4,011 ) $ 1,483 $ 1,901 The Company recorded amortization expense related to amortizable intangible assets of $0.5 million and $0.6 million for the years ended December 31, 2016 and 2015 , respectively. Estimated amortization expense for existing intangible assets for each of the next five years is as follows (in thousands): Years ending December 31: 2017 $ 435 2018 $ 161 2019 $ 161 2020 $ 161 2021 $ 161 Thereafter $ 404 $ 1,483 |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 12 Months Ended |
Dec. 31, 2016 | |
Accrued Expenses and Other Current Liabilities | |
Accrued Expenses and Other Current Liabilities | Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consist of the following (in thousands): December 31, 2016 2015 Accrued salaries and benefits $ 759 $ 1,332 Accrued severance and other charges(1) 1,738 1,092 Accrued warranty(2) 338 228 Warrant liability(3) 1,226 3,072 Liability for consigned precious metals 1,282 543 Other 1,002 1,587 $ 6,345 $ 7,854 _______________________________________________________________________________ (1) For additional information, refer to Note 8 , " Severance and Other Charges ". (2) For additional information, refer to Note 9 , " Accrued Warranty ". (3) For additional information, refer to Note 13, " Fair Value Measurements ". |
Severance and Other Charges
Severance and Other Charges | 12 Months Ended |
Dec. 31, 2016 | |
Restructuring and Related Activities [Abstract] | |
Severance and Other Charges | Severance and Other Charges Severance, exit and other charges consist of the following (in thousands): Years Ended 2016 2015 Employee severance expense $ 1,227 $ 1,210 Other closure costs — 272 Lease exit costs 1,328 — Total severance and other charges $ 2,555 $ 1,482 The Company incurred severance costs in 2015 related to its North American locations, including $0.8 million of severance benefits covering a one year period for our former president and chief operating officer and our former general counsel, corporate secretary and vice president, administration, pursuant to separation and release agreements. Additionally, on December 11, 2015, the Company announced its intention to close its Canadian manufacturing facility. Costs associated with this closure, primarily severance costs, of $0.6 million have been accrued as of December 31, 2015 . During 2016, the Company accrued approximately $1.3 million of lease exit costs associated with its manufacturing facility in Canada. In addition, the Company incurred additional severance costs of approximately $1.2 million associated its Canadian manufacturing facility as well as other North American locations. The following summarizes the activity in the Company's accrual for severance and other exit costs (in thousands): Severance Lease Exit Total December 31, 2014 $ 293 $ 42 $ 335 Provision 1,210 — 1,210 Payments (411 ) (42 ) (453 ) December 31, 2015 $ 1,092 $ — $ 1,092 Provision 1,227 1,328 2,555 Payments (1,601 ) (308 ) (1,909 ) December 31, 2016(1) $ 718 $ 1,020 $ 1,738 _______________________________________________________________________________ (1) The Company expects to pay this accrual during the year ended December 31, 2017 . |
Accrued Warranty
Accrued Warranty | 12 Months Ended |
Dec. 31, 2016 | |
Product Warranties Disclosures [Abstract] | |
Accrued Warranty | Accrued Warranty The Company establishes reserves for future product warranty costs that are expected to be incurred pursuant to specific warranty provisions with its customers. The Company generally warrants its products against defects between one and five years from date of shipment, depending on the product. The warranty reserves are established at the time of sale and updated throughout the warranty period based upon numerous factors including historical warranty return rates and expenses over various warranty periods. Historically, warranty returns have not been material. The following summarizes the activity in the Company's accrual for product warranty (in thousands): Years Ended 2016 2015 Balance at beginning of period $ 228 $ 373 Accrued warranty expense 431 301 Warranty claims paid (324 ) (389 ) Translation adjustment 3 (57 ) Balance at end of period $ 338 $ 228 |
Debt
Debt | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Debt | Debt Debt consists of the following (in thousands): December 31, 2016 December 31, 2015 Line of credit with FGI $ 1,458 $ 3,513 $2.0 million, 8% shareholder note due 2017 (1) 1,803 — $1.5 million, 8% shareholder note due 2018 (2) — 1,623 $3.0 million, 8% subordinated convertible shareholder notes due 2018 (2) — 2,972 $3.0 million, 8% shareholder note due 2018 (2) — 2,964 3,261 11,072 Less current portion (3,261 ) (3,513 ) $ — $ 7,559 _______________________________________________________________________________ (1) Debt discount related to extinguishment and amendment of previous outstanding debt. The aggregate amount of unamortized debt discount was $0.2 million at December 31, 2016. For additional information, refer to the respective discussions below. (2) Debt discounts relate to warrants issued with shareholder notes and amendments. The aggregate amount of unamortized debt discount was $0.1 million at December 31, 2015 . For additional information, refer to the respective discussions below. Line of Credit with FGI The Company maintains a $7.5 million secured demand facility with FGI backed by its receivables and inventory. The Company also granted FGI a first lien collateral interest in substantially all of its assets. The current termination date is August 15, 2017, however, FGI can cancel the facility at any time and demand payment. Under the FGI facility, FGI can elect to purchase eligible accounts receivable from the Company and the Credit Subsidiaries at up to 80% of the value of such receivables (retaining a 20% reserve). Purchased receivables are subject to full recourse to the Company in the event of nonpayment by the customer. FGI becomes responsible for the servicing and administration of the accounts receivable purchased. The Company is not obligated to offer accounts in any month and FGI has the right to decline to purchase any accounts. At FGI's election, FGI may advance the Company up to 80% of the value of any purchased accounts receivable, subject to the $7.5 million limit. Reserves retained by FGI on any purchased receivable are expected to be refunded to the Company net of interest and fees on advances once the receivables are collected from customers. The Company may also borrow against eligible inventory up to the inventory sublimit, as determined by FGI, subject to the aggregate $7.5 million limit under the FGI facility and certain other conditions. At December 31, 2016 , the inventory sublimit amount was the lesser of $1.5 million or 50% of the aggregate purchase price paid for accounts receivable purchased under the FGI facility. While the overall credit limit and the inventory sublimit were not changed, borrowing against the Company's significant OEM customer's inventory has been limited to $0.2 million by FGI due to their concerns about customer concentration as of December 31, 2016 . The interest rate on advances or borrowings under the FGI facility is the greater of (i) 6.50% per annum and (ii) 2.50% per annum above the prime rate, as defined in the FGI facility and was 6.50% at December 31, 2016 and 2015 . Any advances or borrowings under the FGI facility are due on demand. The Company also agreed to pay FGI collateral management fees of 0.30% per month on the face amount of eligible receivables as to which advances have been made and 0.38% per month on borrowings against inventory, if any. At any time outstanding advances or borrowings under the FGI facility are less than $2.4 million , the Company agreed to pay FGI standby fees of (i) the interest rate on the difference between $2.4 million and the average outstanding amounts and (ii) 0.44% per month on 80% of the amount by which advances or borrowings are less than the agreed $2.4 million minimum. At December 31, 2016 , the Company had $0.6 million of gross accounts receivable pledged to FGI as collateral for short-term debt well as $0.8 million in borrowings outstanding against eligible inventory. The Company was in compliance with the terms of the FGI facility at December 31, 2016 . However, there is no guarantee that the Company will be able to borrow to the full limit of $7.5 million if FGI chooses not to finance a portion of its receivables or inventory. Kanis S. A. Indebtedness As of December 31, 2015, the Company had entered into various loan commitments with Kanis S.A with an aggregate outstanding principal balance of $7.5 million . These loans are described in the table above as follows: • $1.5 million , 8% shareholder note due 2018 • $3.0 million , 8% subordinated convertible shareholder note due 2018 • $3.0 million , 8% shareholder note due 2018 On April 1, 2016, the Company executed a Promissory Note (the “Kanis Note”) and entered into an amendment of existing loan agreements (the “Kanis Agreement”) with Kanis S.A. Pursuant to the terms of the Kanis Note, Kanis S.A. agreed to lend the Company $2.0 million at 8% per annum with a maturity date of September 30, 2017. Pursuant to the terms of the Kanis Agreement, the Company and Kanis S.A. agreed to amend prior loans with an aggregate outstanding principal balance of $7.5 million (collectively, the “Loan Agreements”), such that: (i) Kanis S.A. had the right to convert the principal balance of the Loan Agreements and any accrued interest thereon into common stock of the Company at any time prior to maturity at a conversion price equal to the lower of the closing price of CDTi’s common stock on the date before the date of the Kanis Agreement or as of the date when Kanis S.A. exercises its conversion right; and (ii) the Company had the right to mandatorily convert the $7.5 million principal balance and any accrued interest thereon into its common stock upon maturity of the Loan Agreements or earlier upon the occurrence of a Liquidity Event at a conversion price equal to the lower of the closing price of CDTI as of the date immediately before the date of the Kanis Agreement or at a 25% discount to the Liquidity Event price. A Liquidity Event is defined as a strategic investment in CDTi or a public stock offering by CDTi. The Company could prepay the principal and any interest due on the Loan Agreements at any time before their maturity date without penalty. Certain features of the Kanis Note resulting from the Kanis Agreement required bifurcation and were determined to be an embedded derivative comprised of a conversion feature and a call option. The embedded derivative was separated from the Kanis Note and carried as a derivative liability on the balance sheet at fair value, with changes in fair value reported through earnings. The conversion feature could have been exercised at either $3.60 , which is the closing stock price the day prior to the original agreement or at the market price when the conversion was exercised. The call option could have been executed by the Company in the event the Company completes a Liquidity Event. The call option would be settled at a 25% discount to the Liquidity Event pricing. In addition, the Kanis Agreement was considered to trigger an extinguishment of the debt. As a result the Company recorded a loss of approximately $1.6 million for the three and six months ended June 30, 2016 in connection with the Kanis agreement. For additional information on the bifurcated derivative liability, please see Note 13, “Fair Value Measurements”. On June 30, 2016, the Company entered into a Letter Agreement (the “Kanis Exchange Agreement”) with Kanis S.A. The Company agreed to an exchange with Kanis of an aggregate of $7.5 million in principal amount of promissory notes and other indebtedness (collectively, the “Kanis Notes”) held by Kanis, plus accrued interest, for a number of shares of the Company’s common stock equal to (a) the principal amount of the Kanis Notes plus the accrued interest thereon through and including the date of the settlement of the exchange contemplated by the Kanis Exchange Agreement, divided by (b) $1.6215 . At a special meeting of stockholders held on August 25, 2016, the Company's stockholders approved the transactions contemplated by the Kanis Exchange Agreement. On August 30, 2016, the Company consummated the Kanis Exchange Agreement, pursuant to which an aggregate of 4,872,032 shares of common stock was issued to Kanis in exchange for the delivery to the Company of the Kanis Notes and the extinguishment of $7.9 million of indebtedness, including $0.4 million of accrued interest and the bifurcated derivative liability. The exchange resulted in a loss on extinguishment of $10.2 million . Subsequent to the August 30, 2016 conversion, the Company’s sole remaining debt with Kanis S.A. was the loan agreement for $2.0 million , at 8% interest per annum with a maturity date of September 30, 2017, entered into on April 1, 2016. In January 2017, the Company repaid the entire $2.0 million balance. Director note On April 11, 2016, the Company executed a Convertible Promissory Note (the “Director Note”) with Lon E. Bell, Ph.D., one of the Company’s Directors. Pursuant to the terms of the Director Note, Dr. Bell agreed to lend the Company $0.5 million at 8% per annum and a maturity date of September 30, 2017. Dr. Bell had the right to convert the principal balance of the Director Note and any accrued interest thereon into common stock of the Company at any time prior to maturity at a conversion price equal to the lower of the closing price of CDTi on the date before the date of the Director Note or as of the date when Dr. Bell exercises his conversion right. The Company had the right to mandatorily convert the principal balance of the Director Note and any accrued interest thereon into its common stock upon maturity at a conversion price equal to the lower of the closing price of CDTi on the date before the date of the Director Note or on the maturity date. The Company also had the right to mandatorily convert the principal amount of the Director Note plus accrued interest thereon into its common stock concurrently with the closing of a Liquidity Event, as defined, at a conversion price equal to the lower of the closing price of CDTi as of the date immediately before the date of this Director Note or at a 25% discount to the Liquidity Event price. A Liquidity Event is defined as a strategic investment in CDTi or a public stock offering by CDTi. Effective May 12, 2016, the Director Note was amended and restated to amend the conversion features contained therein. The Director Note, which originally had a floating conversion price, allowed Dr. Bell to convert the principal balance of the note and any accrued interest thereon at any time before payment into shares of the Company’s common stock at a fixed conversion price of $3.55 per share (subject to adjustment for stock splits, reverse stock splits, and similar events) (the “Conversion Price”), which was the closing consolidated bid price of the Company’s common stock on the trading day immediately prior to the date of issuance. In addition, the Company had the right to mandatorily convert the principal balance of the Director Note plus any accrued interest into shares of the Company’s common stock at the Conversion Price upon the earlier of the Maturity Date and the closing of a Liquidity Event if, and only if, the Conversion Price was less than the average closing price of the Company’s common stock for the five consecutive trading days ending on the trading day immediately preceding the date the Company exercises its conversion rights. On June 30, 2016, the Company entered into a Letter Agreement (the “Bell Exchange Agreement”) with Dr. Bell. The Company agreed to an exchange with Dr. Bell of the Director Note for a number of shares of the Company’s common stock equal to (a) the principal amount of the Bell Note plus the accrued interest thereon through and including the date of the settlement of the exchange contemplated by the Bell Exchange Agreement, divided by (b) $1.6215 . At a special meeting of stockholders held on August 25, 2016, the stockholders approved the transactions contemplated by the Bell Exchange Agreement. On August 30, 2016, the Company consummated the Bell Exchange Agreement transaction, pursuant to which an aggregate of 317,950 shares of common stock was issued to Dr. Bell in exchange for the delivery to the Company of the Bell Note and the extinguishment of $0.5 million of indebtedness, including accrued interest. The exchange resulted in a loss on extinguishment of $0.6 million . Note Purchase Agreement and Convertible Notes On June 30, 2016, the Company also entered into a Note Purchase Agreement (the “Note Purchase Agreement”) with Haldor Topsøe A/S, a company organized under the laws of Denmark (“Haldor Topsøe”). The Company agreed to sell and issue (i) a Senior Convertible Promissory Note (the “Senior Note”) in the principal amount of $0.75 million and (ii) a Convertible Promissory Note (the “Note”, and with the Senior Note, the “Convertible Notes”) in the principal amount of $0.5 million , each of which is convertible into the Company’s equity securities. The Convertible Notes provided for interest at a rate of 8% per annum, matured on December 31, 2016 and bore no prepayment penalty. The Convertible Notes provided that they shall at no time be convertible into more than 779,350 shares (subject to adjustment for stock splits, reverse stock splits, and similar events) of the Company’s common stock and/or other securities convertible or exercisable for such number of shares of the Company’s common stock. The Convertible Notes permitted Haldor Topsøe to convert the principal balance of the Convertible Notes into shares of the Company’s common stock at a fixed conversion price of $1.6215 per share at any time. In addition, the Senior Note permitted Haldor Topsøe to convert the principal balance of the Senior Note into equity securities that the Company may issue in a future financing including any instruments or securities exchangeable for or convertible into equity securities, at the same price and on the same terms at which the Company sells equity securities in such future financing. The Company had the right to mandatorily convert the Convertible Notes. As long as the Company’s common stock continued to be listed on The NASDAQ Stock Market, LLC (“NASDAQ”) and the Company was not in default under the Note, the Company had the right to mandatorily convert the principal balance of the Note into shares of its common stock at the conversion price of $1.6215 per share at any time before payment and following the date of conversion of the Kanis Notes into the Company’s common stock. The Company has the right to mandatorily convert the Senior Note, subject to satisfaction of the same conditions to conversion of the Note, upon consummation of a Qualified Financing into the equity securities the Company issues in the Qualified Financing at the same price and on the same terms at which it sells such equity securities in the Qualified Financing. A “Qualified Financing” is defined as an equity or equity-linked financing in which the Company received aggregate gross proceeds of at least $5.0 million (including the principal amount of the Senior Note converted in such financing). Accrued interest under the Convertible Notes is not convertible into the Company’s equity securities and any interest that has accrued on principal amount converted into equity securities will be paid in cash at the time of such conversion. Pursuant to the Note Purchase Agreement, the Company agreed, if requested by Haldor Topsøe, to expand the size of its board of directors by one member and appoint one person designated by Haldor Topsøe. Thereafter, until the later of (i) the date that the Convertible Notes have been paid in full or (ii) if 100% of the principal amount of the Convertible Notes have been converted into the Company’s common stock and/or other equity securities, the date Haldor Topsøe no longer owns at least eighty percent ( 80% ) of such securities, the Company’s board shall include one person designated by Haldor Topsøe in the board’s slate of nominees to be submitted to stockholders at each meeting of stockholders of the Company where directors are to be elected. On August 30, 2016, Haldor Topsøe elected to convert the Note for which the Company issued to Haldor Topsøe an aggregate of 308,357 shares of common stock in conversion of $0.5 million in principal amount of indebtedness. On December 16, 2016, Haldor Topsøe elected to convert the Senior Note, and issued to Haldor Topsøe and aggregate of 462,535 shares of common stock in conversion of $0.75 million in principal amount of indebtedness. For additional information on the warrants discussed within this Note, refer to Note 11 , " Stockholders' Equity " and Note 12 " Warrants ", respectively. Annual scheduled principal payments of debt based on earliest redemption date as of December 31, 2016 are (in thousands): Years ending December 31: 2017 $ 3,458 2018 — Total $ 3,458 |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2016 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Stockholders' Equity On February 12, 2016, at a special meeting of the Company’s stockholders, the Company’s stockholders voted to approve an amendment to the Restated Certificate of Incorporation to increase the number of authorized shares from 24.0 million shares to 100.0 million shares. Further, on February 12, 2016, the Company filed with the Secretary of State of Delaware a Certificate of Amendment to the Restated Certificate of Incorporation (the “Amendment”) which increased the number of authorized shares from 24.0 million shares to 100.0 million shares, ninety-nine million nine hundred thousand ( 99.9 million ) of which were designated as common stock and one hundred thousand ( 0.1 million ) of which were designated as preferred stock. On May 25, 2016 at the Company’s Annual Meeting of Stockholders, the stockholders also voted to approve the amendment of the Restated Certificate of Incorporation to effect a reverse stock split of the Company’s common stock which to reduce the total number of shares authorized under the Restated Certificate of Incorporation from 100.0 million to 20.0 million . On July 21, 2016, the Company filed a Certificate of Amendment to its Restated Certificate of Incorporation, as amended, with the Secretary of State of Delaware to effect a one-for- five reverse stock split of the Company’s common stock, (the “ Reverse Stock Split ”). The amendment became effective on July 22, 2016. As a result of the Reverse Stock Split, every five (5) shares of the Company’s issued and outstanding common stock were combined and reclassified into one (1) share of the Company’s common stock. The Reverse Stock Split did not change the par value of the Company’s common stock. All share and per share information disclosed in this report, including the conversion features of all warrants (shares and exercise prices) reflect the Reverse Stock Split. On December 16, 2016, the Company filed with the Secretary of State of Delaware a Certificate of Amendment to the Company’s Restated Certificate of Incorporation (the “Amendment”) which increased the number of authorized shares from 20,000,000 shares to 50,100,000 shares, of which 50,000,000 are designated as common stock and 100,000 are designated as preferred stock. June 2015 Offering In June 2015, the Company agreed to offer and sell up to 500,000 units at a price to the public of $10.25 per unit (the "June 2015 Offering"). Each unit consisted of one share of common stock and 0.2 of a warrant to purchase one share of common stock. The June 2015 Offering warrants have an exercise price of $13.25 per share and can be exercised during the period commencing after six months and ending five and a half years from the date of issuance. The Company received gross proceeds of $5.1 million and net proceeds of $4.5 million after deducting the underwriting discounts and other offering expenses. The June 2015 Offering warrants are within the scope of ASC 815-40 and are required to be recorded as liabilities. Accordingly, of the $4.5 million in net proceeds, $3.7 million was allocated to the common stock and included in equity and $0.8 million was allocated to the warrant liability based on the fair value of the warrants on the issuance date. Additionally, $0.1 million of the underwriter discounts and other offering costs were allocated to the June 2015 Offering warrants, based on the relative fair value of the June 2015 Offering warrants and the common stock on the issuance date, and was included in other income (expense), net in the accompanying statements of comprehensive loss for the year ended December 31, 2015 . November 2015 Offering In November 2015, the Company entered into a securities and purchase agreement with certain institutional investors (the "Purchasers") providing for the issuance and sale by the Company of 176,772 shares of the Company's common stock and Series B pre-funded warrants (the "Pre-Funded Warrants") to purchase an aggregate of 337,228 shares of its common stock. The offering price was $6.10 per share of common stock and the offering price for the Pre-Funded Warrant was $6.05 for each to purchase one share of common stock. The Pre-Funded Warrants are immediately exercisable at an exercise price of $0.05 per share and expire two years from the date of issuance. In a concurrent private placement, the Company issued 0.3 of a Series A warrant to purchase one share of common stock for each share of common stock purchased or pre-funded through the Pre-Funded Warrants in the registered offering. Each whole Series A Warrant can be exercised for a share of Common Stock. The Series A Warrants cover, in the aggregate, 154,200 shares of common stock and become exercisable seven months following the date of issuance at an exercise price of $8.50 per share and expire five years from the date they become exercisable. In addition, in exchange for the surrender and cancellation for outstanding warrants to purchase 171,279 shares of common stock, with a weighted average exercise price of $15.95 per share, held by the Purchasers, the Company issued Series C-1, Series C-2 and Series C-3 warrants to purchase an aggregate of 171,279 shares of common stock which will become exercisable seven months following the date of issuance at an exercise price of $8.50 per share. Each Exchange Warrant will expire seven months from the expiration date set forth in the corresponding cancelled warrant. The transactions noted just above are collectively referred to as the "November 2015 Offering". The Company received gross proceeds of $3.1 million and net proceeds of $2.6 million after deducting placement agent fees and other offering expenses. Accordingly, of the $3.1 million in gross proceeds initially included in equity, $0.1 million of the offering costs were allocated to common stock, based on the relative fair value of the common stock and the November 2015 Offering warrants on the issuance date. The November 2015 Offering warrants are within the scope of ASC 815-40 and are required to be recorded as liabilities. Accordingly, $3.4 million was allocated to the warrant liability based on the fair value of the warrants on the issuance date. As the assigned fair values of the November 2015 Offering warrants were greater than the net cash proceeds allocated to common stock, the $0.4 million excess was treated as offering costs and included in other income (expense), net in the accompanying statements of comprehensive loss for the year ended December 31, 2015, along with the $0.4 million of offering costs allocated to the November 2015 Offering warrants. November 2016 Offering On November 3, 2016, the Company entered into a securities purchase agreement with certain investors (the "Purchasers") providing for the issuance and sale of 5,172,250 shares of the Company's common stock at a price of $2.00 per share (the "November 2016 Offering"). On November 4, 2016, and December 16, 2016 the Company sold 949,960 and 4,222,290 shares of Common Stock, respectively, under the November 2016 Offering. The Company also issued to the placement agent, in consideration for its services as placement agent for the November 2016 Offering, a total of 489,475 shares of Common Stock and a five-year warrant to purchase up to 489,475 shares of Common Stock at an exercise price of $2.20 per share On October 24, 2016, the Company received a written consent from Kanis S.A., the holder of a majority of the Company's outstanding shares of common stock as of such date, approving the offer and sale of securities by the Company in a private placement transaction, or series of related private placement transactions, on terms similar to the terms of the November 2016 Offering. The Company received net proceeds of $10.2 million after deducting placement agent fees and other offering expenses. The November 2016 Offering warrants are within the scope of ASC 815-40 and are required to be recorded as liabilities. Accordingly, of the $10.2 million in net proceeds, $9.3 million was allocated to the common stock and included in equity and $0.9 million was allocated to the warrant liability based on the fair value of the warrants on the issuance date. The Company intends to use the net proceeds for general corporate purposes, which may include working capital, general and administrative expenses, capital expenditures and implementation of its strategic priorities. Exchange Transactions As discussed in Note 10, on August 30, 2016, the Company consummated the Kanis Exchange Agreement and Bell Exchange Agreement transactions, pursuant to which the Company (i) issued to Kanis an aggregate of 4,872,032 shares of common stock in exchange for the delivery to the Company of the Kanis Notes and the extinguishment of $7.9 million of indebtedness, and (ii) issued to Dr. Bell an aggregate of 317,950 shares of common stock in exchange for the delivery to the Company of the Director Note and the extinguishment of $0.5 million of indebtedness Note Conversion As discussed in Note 10, on August 31, 2016, the Company elected to convert $0.5 million in principal amount of the Haldor Notes and issued Haldor Topsøe 308,357 shares of the Company's common stock. On December 16, 2016, Haldor Topsøe elected to convert $0.75 million in principal amount of the Haldor Notes and issued Haldor Topsøe 462,535 shares of the Company's common stock. Other Sales and Issuances of Common Stock and Warrants On December 16, 2016, the Company entered into a securities purchase agreement with MDB Capital Group, LLC ("MDB"), providing for the sale of 81,550 shares of the Company's common stock at a price of $2.00 per share for an aggregate purchase price of $0.2 million . The purchase price was paid by the cancellation of trade payables of the Company to MDB in the amount of the purchase price. |
Warrants
Warrants | 12 Months Ended |
Dec. 31, 2016 | |
Warrants and Rights Note Disclosure [Abstract] | |
Warrants | Warrants From time to time, the Company issues warrants to purchase its common stock. Warrants have been issued for consulting services, in connection with the Company's issuance of debt and sales of its common stock. For additional information regarding the warrants discussed in this Note, refer to Note 10 , " Debt " and Note 11 " Stockholders' Equity ", respectively. Warrants activity is summarized as follows: Shares(1) Weighted Average Exercise Price Range of Exercise Prices Outstanding at December 31, 2014 322,011 $ 17.71 $6.25 - $52.00 Issued 591,423 $ 4.50 $0.05 - $6.25 Exchange warrants issued 171,276 $ 8.50 8.50 Exchange warrants surrendered (171,276 ) $ 15.95 $13.25 - $21.00 Outstanding at December 31, 2015 913,434 $ 3.54 $6.25 - $52.00 (2) Issued 489,475 $ 2.20 $2.20 Exercised (410,824 ) $ 1.73 $0.05 - $3.00 Expired (12,216 ) $ 22.50 $22.50 Outstanding at December 31, 2016 979,869 $ 6.36 $0.05 - $21.00 Exercisable at December 31, 2016 979,869 $ 6.36 $6.25 - $21.00 _______________________________________________________________________________ (1) Outstanding and exercisable information includes 21,920 equity-classified warrants as of December 31, 2016 . (2) Includes the effects of repricing. Refer to the November 2015 Offering in Note 11 " Stockholders' Equity ." Warrant Liability The Company's warrant liability is carried at fair value and is classified as Level 3 in the fair value hierarchy because the warrants are valued based on unobservable inputs. The Company determines the fair value of its warrant liability using the Black-Scholes option-pricing model unless the awards are subject to market conditions, in which case it uses a Monte Carlo simulation model, which utilizes multiple input variables to estimate the probability that market conditions will be achieved. These models are dependent on several variables such as the instrument's expected term, expected strike price, expected risk-free interest rate over the expected term of the instrument, expected dividend yield rate over the expected term and the expected volatility. The expected strike price for warrants with full-ratchet down-round price protection is based on a weighted average probability analysis of the strike price changes expected during the term as a result of the full-ratchet down-round price protection. The assumptions used in the Black-Scholes option-pricing model to estimate the fair value of the warrant liability as of December 31, 2016 were as follows: Expected volatility 97.7% - 106.4% Risk-free interest rate 1.40% - 1.92% Dividend yield — Expected life in years 2.8 - 5.0 The assumptions used in the Monte Carlo simulation model to estimate the fair value of the warrant liability as of December 31, 2016 were as follows: Expected volatility 97.7%-106.4% Risk-free interest rate 1.03%-1.43% Dividend yield — Expected life in years 1.5-2.9 The warrant liability, included in accrued expenses and other current liabilities in the accompanying consolidated balance sheets, is re-measured at the end of each reporting period with changes in fair value recognized in other income (expense), net in the consolidated statements of comprehensive loss. Upon the exercise of a warrant that is classified as a liability, the fair value of the warrant exercised is re-measured on the exercise date and reclassified from warrant liability to additional paid-in capital. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The Company measures certain financial assets and liabilities at fair value in accordance with a hierarchy which requires an entity to maximize the use of observable inputs which reflect market data obtained from independent sources and minimize the use of unobservable inputs. There are three levels of inputs that may be used to measure fair value: Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities; Level 2: Inputs other than quoted prices included within Level 1 that are either directly or indirectly observable including quoted prices for similar instruments in active markets and quoted prices for identical or similar instruments in markets that are not active; and Level 3: Unobservable inputs in which little or no market activity exists, therefore requiring an entity to develop its own assumptions about the assumptions that market participants would use in pricing. Assets and liabilities measured at fair value on the Company’s balance sheet on a recurring basis include the following at December 31, 2016 and December 31, 2015 (in thousands): Warrant Liability Level 1 Level 2 Level 3 December 31, 2016 — — $ 1,226 December 31, 2015 — — $ 3,072 There were no transfers in and out of Level 1 and Level 2 fair value measurements during the year ended December 31, 2016. The following is a reconciliation of the warrant liability, included in accrued expenses and other current liabilities in the accompanying unaudited condensed consolidated balance sheets, measured at fair value using Level 3 inputs (in thousands): Years Ended 2016 2015 Balance at beginning of period $ 3,072 $ 1,474 Issuance of common stock warrants 858 4,215 Exercise of common stock warrants (1,150 ) — Gain on change in fair value (1,554 ) (2,617 ) Balance at end of period $ 1,226 $ 3,072 The following is a reconciliation of the embedded bifurcated derivative liability measured at fair value using significant unobservable inputs, Level 3 (in thousands): Years Ended December 31, 2016 2015 Balance at beginning of period $ — $ — Transfers in and/or out of Level 3 — — Initial valuation of bifurcated derivative liability 3,936 — Extinguishment of bifurcated derivative liability (3,936 ) — Balance at end of period $ — $ — Upon amendment of the Kanis debt on April 1, 2016, the convertible debt required bifurcation and accounting at fair value. The resulting embedded derivative was comprised of a conversion option, the exercise of which would require shareholder approval, as well as a call option the Company could exercise in the event of a Liquidity Event. The call option would be at a 25% discount to the Liquidity Event price. The company used a Monte Carlo simulation model to estimate the fair value of the embedded derivative portion of the Kanis debt. The assumptions used in the Monte Carlo simulation model to estimate the fair value of the derivative liability included volatility of 109% , a risk free rate of 0.8% and an expected term of 2.5 years. On August 30, 2016, the Kanis debt was extinguished eliminating the embedded derivative. The fair values of the Company’s cash, accounts receivable, prepaid expenses and other current assets, accounts payable and accrued expenses and other current liabilities approximate carrying values due to the short maturity of these instruments. The fair value of the line of credit approximates its carrying value due to the variable interest rates. Using a net present value model, the fair value of the Company’s current notes payable is $1.8 million at December 31, 2016. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of assets and liabilities and their placement within the fair value hierarchy. |
Stock-Based Compensation
Stock-Based Compensation | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation The Clean Diesel Technologies, Inc. Stock Incentive Plan (formerly known as the Clean Diesel Technologies, Inc. 1994 Incentive Plan), as amended (the "Plan"), provides for the awarding of incentive stock options, non-qualified stock options, stock appreciation rights, restricted shares, performance awards, bonuses or other forms of share-based awards, or combinations of these to the Company's directors, officers, employees, consultants and advisors (except consultants or advisors in capital-raising transactions) as determined by the board of directors. At the Company's Annual Meeting of Shareholders held on May 23, 2012, the Company's shareholders approved certain amendments to the Plan, the most significant of which changed the Plan name, removed the evergreen provision and established a maximum number of 1.4 million shares to be reserved for issuance under the Plan, disallowed the repricing of outstanding stock options without shareholder approval, removed the ability to issue cash bonus awards under the Plan and modified the change in control provisions within the Plan. As of December 31, 2016 , there were 81,766 shares available for future grants under the Plan. Effective December 16, 2016, the Company adopted the Clean Diesel Technologies, Inc. 2016 Omnibus Incentive Plan (the "Omnibus Plan"), pursuant to the approval of the Omnibus plan by the Company's stockholders by written consent dated October 24, 2016. The Omnibus plan was adopted by the Company's Board of Directors (the "Board") on October 11, 2016. Under the Omnibus Plan, the Company is authorized to grant equity-based awards in the form of stock options, restricted common stock, restricted stock units, stock appreciation rights, and other stock based awards to employees (including executive officers), directors and consultants of the Company and its subsidiaries. The Omnibus Plan authorized the issuance of 2,250,000 shares of the Company's common stock. Total stock-based compensation expense was $1.6 million and $0.8 million for the years ended December 31, 2016 and 2015 , respectively. Stock Options Stock option activity is summarized as follows: Options Weighted Weighted Aggregate Outstanding at December 31, 2015 256,963 $ 20.01 7.7 — Granted 875,000 $ 2.24 — — Cancelled (24,500 ) $ 8.47 — — Vested shares expired (34,175 ) $ 36.68 — $ — Outstanding at December 31, 2016 1,073,288 $ 5.26 9.4 $ 5,500 Exercisable at December 31, 2016 471,374 $ 8.82 8.8 $ 2,750 The aggregate intrinsic value represents the difference between the exercise price and the Company's closing stock price on the last trading day of the year. Stock options granted under the Plan typically expire ten years from the date of grant and are issued at a price equal to the fair market value of the underlying stock on the date of grant. The Company's board of directors may establish such vesting and other conditions with respect to options as it deems appropriate. The Company estimates the fair value of stock options using a Black-Scholes option-pricing model. The weighted-average assumptions and grant date fair value for the options granted during year ended December 31, 2016 were as follows: Years Ended December 31, 2016 2015 Expected volatility 153.7% - 168.5% 126.0 % Risk-free interest rate 1.19% - 2.18% 1.7 % Dividend yield — — Expected life in years 6.0 5.4 Weighted average grant date fair value $ 2.12 $ 7.60 The expected term of the options has historically been based upon the historical term until exercise or expiration of all granted options. Due to the significant change in the Company following the Merger and significant change in the terms of the options granted, CDTI's pre-Merger historical exercise data was not considered to provide a reasonable basis for estimating the expected term for current option grants. As such, the expected term of stock options granted in 2015 was determined using the "simplified method" as allowed under ASC 718-10-S99, "Compensation—Stock Compensation: Overall: SEC Materials." The "simplified method" calculates the expected term as the average of the vesting term and original contractual term of the options. The expected volatility is based on the volatility of the Company over the corresponding expected term of the option. The risk-free interest rate is the constant maturity rate published by the U.S. Federal Reserve Board that corresponds to the expected term of the option. The dividend yield is assumed as 0% because the Company has not paid dividends and does not expect to pay dividends in the future. Compensation costs for stock options that vest over time are recognized over the vesting period on a straight-line basis. As of December 31, 2016 , the Company had $1.3 million of unrecognized compensation cost related to stock option grants that remained to be recognized over vesting periods. These costs are expected to be recognized over a weighted average period of 3.7 years. Restricted Stock Units RSU activity is as follows: Shares Weighted Nonvested at December 31, 2015 39,405 $ 12.55 Granted 5,789 $ 2.64 Vested (28,806 ) $ 11.38 Forfeited (3,999 ) $ 13.05 Nonvested units at December 31, 2016 12,389 $ 10.50 As of December 31, 2016 , the Company had approximately $37.5 thousand of unrecognized compensation expense related to RSUs, which will be recognized over a weighted average estimated remaining life of 0.9 years. |
Impairment
Impairment | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Impairment | Impairment The Company performs its annual impairment test during the fourth quarter, after the annual budgeting process is completed. Furthermore, goodwill is reviewed for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Each interim period, management assesses whether or not an indicator of impairment is present that would necessitate that a goodwill impairment analysis be performed in an interim period other than during the fourth quarter. During the Company’s annual impairment analysis during the fourth quarter of 2016, management used a discount rate of 15% and a terminal growth rate of 3% . The discount rate used in the discount cash flow method was based on a weighted-average cost of capital determined from relevant market comparisons, adjusted for specific reporting unit risks (i.e. primarily the uncertainty of achieving projected operating cash flows). The terminal value growth rate was applied to the final year of the projected period and reflected the Company's estimate of stable, perpetual growth. The inputs utilized in the analyses are classified as Level 3 inputs within the fair value hierarchy as defined in ASC Topic 820 “Fair Value Measurements and Disclosures” (“ASC 820”). Due to the complexity and the effort required to estimate the fair value of the reporting units in the step one of the impairment test and to estimate the fair values of all assets and liabilities of the reporting units in the second step of the test, the fair value estimates were derived based on assumptions and analyses that are subject to change. Such assumptions include but are not limited to the following: changes in its cost of capital, growth of the reporting unit's revenue, cost structure of the reporting unit, successful completion of research and development and customer acceptance of new products, expected changes in emissions regulations and approval of the reporting unit's product by regulatory agencies. Based on the Company’s analyses, the implied fair value of goodwill was substantially lower than the carrying value of goodwill for its reporting unit. As a result during the fourth quarter of 2016, the Company recognized, an impairment charge of $4.7 million . This impairment charge was included as a separate component of operating expenses for the year ended December 31, 2016. As a result, as of December 31, 2016, the Company had no goodwill on its consolidated balance sheet. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes Income (loss) from continuing operations before income taxes include the following components (in thousands): Years Ended 2016 2015 U.S.-based operations $ (17,344 ) $ (7,770 ) Non U.S.-based operations (7,088 ) (1,051 ) $ (24,432 ) $ (8,821 ) Income tax expense (benefit) attributable to loss from continuing operations is summarized as follows (in thousands): Current Deferred Total Year ended December 31, 2016: State and local $ 22 $ — $ 22 Foreign (210 ) (770 ) (980 ) Total $ (188 ) $ (770 ) $ (958 ) Year ended December 31, 2015: U.S. Federal $ — $ — $ — State and local 4 — 4 Foreign (269 ) (134 ) (403 ) Total $ (265 ) $ (134 ) $ (399 ) Income taxes attributable to loss from continuing operations differ from the amounts computed by applying the U.S. federal statutory rate of 34% to loss from continuing operations before income taxes as shown below (in thousands): Years Ended 2016 2015 Expected tax benefit $ (8,307 ) $ (2,999 ) Net tax effects of: Foreign tax rate differential 1,331 167 State taxes, net of federal benefit 219 (602 ) Return to provision adjustment 13,386 (619 ) Research and other credits 443 (59 ) Permanent difference on convertible notes and warrants 2,923 (589 ) Goodwill impairment 533 — Other 61 52 Change in deferred tax asset valuation allowance (11,547 ) 4,250 $ (958 ) $ (399 ) Deferred tax assets and liabilities consist of the following (in thousands): December 31, 2016 2015 Deferred tax assets: Research and development credits $ 2,063 $ 2,763 Other credits — 487 Operating loss carry forwards 7,320 17,249 Interest 460 — Inventories 289 254 Allowance for doubtful accounts 129 116 Depreciation 353 382 Deferred research and development expenses for income tax — 240 Non-cash compensation 946 1,120 Other 929 921 Total gross deferred tax assets 12,489 23,532 Valuation allowance (11,441 ) (23,091 ) Net deferred tax assets $ 1,048 $ 441 Deferred tax liabilities: Other identifiable intangible assets $ (494 ) $ (634 ) Total gross deferred tax liabilities (494 ) (634 ) Net deferred tax assets (liabilities) $ 554 $ (193 ) The Company had approximately $14.7 million and $14.8 million of federal and state income tax net operating loss carryforwards at December 31, 2016 , respectively. The foreign net operating losses can be carried forward indefinitely. Future utilization of the federal and state net operating losses and credit carryforwards is subject to a substantial annual limitation due to ownership change limitations as required by Sections 382 and 383 of the Internal Revenue Code of 1986, as amended (the "Code"), as well as similar state limitations. In connection with the settlement of the Kanis S.A. debt exchange (see Note 10), a change in control of the Company occurred with Kanis S.A. becoming the largest owner of the Company's common stock in an amount greater than 50% of the issued and outstanding shares of common stock. As a result, the Company performed a study to evaluate the status of net operating loss carryforwards as a result of the ownership change during the year. The results of the study provided that there was indeed an “ownership change” as of August 30, 2016 as defined for U.S. federal income tax purposes. The "ownership change" will significantly limit the use of the Company's net operating losses and credits in future tax years Of the $14.7 million federal loss carryforwards approximately $11.9 million of the loss will be subject to an annual limitation of $1.1 million within the next 5 years and $0.3 million for the next 15 years. The federal net operating loss carryforwards will expire in fiscal year 2036. As a result of the "ownership change" the federal research and development credits have been limited and based on the limitation the Company does not anticipate being able to use any of these credits that existed as of the date of the Merger in future tax years. Of the $14.8 million of state net operating loss carryforwards approximately $10.4 million of the loss will be subject to an annual limitation of $1.1 million within the next 5 years and $0.3 million for the next 15 years. The state net operating loss carryforwards will expire in fiscal year 2036. The Company has state research and development credits of $3.9 million however they have placed a 20% reserve on the credit since a thorough R&D study was not performed. Since the state credits have an indefinite life, the Company did not write them off even though it is also limited under Section 383. The Company has a full valuation allowance against the related deferred tax assets for its U.S. and U.K. entities as it is more likely than not that they will not be realized by the Company. In assessing the potential realization of deferred tax assets, consideration is given to whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the Company attaining future taxable income during the periods in which those temporary differences become deductible. In addition, the utilization of net operating loss carryforwards may be limited due to restrictions imposed under applicable federal and state tax laws due to a change in ownership. Based upon the level of historical operating losses and future projections, management believes it is more likely than not that the Company will not realize the deferred tax assets. The Company has not recognized a deferred tax liability on undistributed earnings of its foreign subsidiaries, because these earnings are intended to be permanently reinvested. The amount of the unrecognized deferred tax liability depends on judgment required to analyze the withholding tax due, the applicable tax law and factual circumstances in effect at the time of any such distributions. Therefore, the Company believes it is not practicable at this time to reliably determine the amount of unrecognized deferred tax liability related to its undistributed earnings; however, these undistributed earnings are immaterial. If circumstances change and it becomes apparent that some or all of the undistributed earnings of a subsidiary will be remitted and income taxes have not been recognized by the parent entity, the parent entity shall accrue as an expense of the current period income taxes attributable to that remittance. The following changes occurred in the amount of unrecognized tax benefits including related interest and penalties, included in the income taxes payable on the consolidated balance sheet (in thousands): Years Ended 2016 2015 Balance at beginning of year $ 634 $ 683 Additions for current year tax provisions 49 32 Additions/Reduction for tax positions of prior years 786 — Reduction for prior year tax provisions — (81 ) Balance at end of year $ 1,469 $ 634 If recognized, the entire amount of the unrecognized tax benefits would affect the effective tax rate. As of December 31, 2016 and 2015 , the Company had $0.2 million and $0.1 million , respectively, accrued for payment of interest and penalties related to unrecognized tax benefits. The Company operates in multiple tax jurisdictions, both within and outside of the United States. Although the timing of the resolution and/or closure of audits is not certain, the Company does not believe it is reasonably possible that its unrecognized tax benefits would materially change in the next twelve months. The following tax years remain open to examination by the major domestic taxing jurisdictions to which it is subject: Open Tax Years United States—Federal 2013 - 2016 United States—State 2012 - 2016 Canada 2011 - 2016 Sweden 2014 - 2016 United Kingdom 2012 - 2016 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Lease Commitments The Company leases certain equipment and facilities under operating leases that expire through 2020. The Company recognizes its minimum lease payments, including escalation clauses, on a straight-line basis over the minimum lease term of the lease. Rent expense was $0.6 million and $0.9 million during the years ended December 31, 2016 and 2015 , respectively. Future minimum lease payments under non-cancelable operating leases (with initial or remaining lease terms in excess of one year) as of December 31, 2016 are (in thousands): Years ending December 31: 2017 $ 501 2018 462 2019 2 2020 1 2021 and thereafter — Total minimum lease payments $ 966 California Air Resources Board ( "CARB" ) By email dated June 26, 2015, CARB asserted the Company had deficiencies in compliance with the Verification Procedure, Aftermarket Parts Regulations and the Vehicle Code. The initial penalty calculated by CARB for these alleged violations was $1.8 million , with the largest component relating to the use of empty center bodies to allow trucks to be placed back in service while warranty claims are being evaluated. This process is now explicitly permitted by regulation, but was not permitted at the time of the alleged violation. Although the Company disagreed, and continues to disagree, with CARB's findings, the Company has cooperated with CARB's investigation and discussed with CARB whether and to what extent the payment of monetary penalties would be appropriate. After review and evaluation of CARB's findings and publicly available CARB settlements for similar matters, the Company has accrued an expense of less than $0.1 million as of December 31, 2016 for a proposed settlement provided to CARB to resolve this matter. During 2016, CARB responded to the Company's proposed settlement with a counter-proposal of $0.8 million by cutting certain components of their initial penalty in half and reducing certain penalties. During the first quarter of 2017, the Company and CARB reached a settlement in which the Company will pay approximately $0.1 million in 2017. For information related to commitments and contingencies related to AUS, a former subsidiary of the Company that was sold in 2009, refer to Note 21 , " Discontinued Operations ". In addition to the foregoing, the Company is involved in legal proceedings from time to time in the ordinary course of its business. Management does not believe that any of these claims and proceedings against it is likely to have, individually or in the aggregate, a material adverse effect on the Company's consolidated financial condition, results of operations or cash flows. Accordingly, the Company cannot determine the final amount, if any, of its liability beyond the amount accrued in the consolidated financial statements as of December 31, 2016 , nor is it possible to estimate what litigation-related costs will be in the future. |
Geographic Information
Geographic Information | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Geographic Information | Geographic Information In the past, the Company operated in two reportable business division segments based on the products it delivered. Beginning in the last quarter of 2015, the Company began transitioning from a niche manufacturer of emission control solutions for the automotive and heavy duty diesel markets to becoming an advanced materials technology provider for these markets. During the second quarter of 2016, the transition of the operating strategy was completed and the Company now views its operations and measures its business as one reportable segment. Net sales by geographic region based on location of sales organization is as follows (in thousands): Years Ended 2016 2015 United States $ 23,870 $ 24,323 Canada 9,583 12,143 Europe 3,386 3,272 Total international 12,969 15,415 Total revenues $ 36,839 $ 39,738 Property and equipment, net and total assets by geographic region as of December 31, 2016 and 2015 is as follows (in thousands): Property and Equipment, net Total Assets 2016 2015 2016 2015 United States $ 1,082 $ 1,247 $ 15,126 $ 11,266 Canada 71 290 8,352 11,641 Europe 5 1 1,352 2,195 Total international 76 291 9,704 13,836 Total $ 1,158 $ 1,538 $ 24,830 $ 25,102 |
Concentrations
Concentrations | 12 Months Ended |
Dec. 31, 2016 | |
Risks and Uncertainties [Abstract] | |
Concentrations | Concentrations For the years ended December 31, 2016 and 2015 , Honda accounted for 59% and 57% , respectively, of the Company's revenues. This customer accounted for 35% and 31% of the Company's accounts receivable at December 31, 2016 and 2015 , respectively. For the year ended December 31, 2016, the Company had one supplier that accounted for approximately 30% of the Company's material purchases. For the year ended December 31, 2015, the Company had two suppliers that accounted for approximately 58% of the Company's material purchases. |
Supplementary Cash Flow Informa
Supplementary Cash Flow Information | 12 Months Ended |
Dec. 31, 2016 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Information | Supplementary Cash Flow Information Supplementary cash flow information for 2016, and 2015 is as follows (in thousands): Years Ended 2016 2015 Cash paid for interest 694 1,075 Cash paid for income taxes 43 227 Non-cash operating and financing activities Kanis S.A. notes payable plus accrued interest settled with common stock (Note 10) 7,900 — Haldor Topsøe note payable settled with common stock (Note 10) 1,250 — Director Note payable plus accrued interest settled with common stock (Note 10) 515 — Issuance of common stock to placement agent in connection with equity offering (Note 11) 5 — Issuance of warrants to placement agent in connection with equity offering (Note 11) 857 — Accounts Payable settled with common stock 184 — |
Discontinued Operations
Discontinued Operations | 12 Months Ended |
Dec. 31, 2016 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | Discontinued Operations Applied Utility Systems, Inc. The Company is undergoing a sales and use tax audit by the State of California (the "State") on AUS for the period of 2007 through 2009. The audit has identified a project performed by the Company during that time period for which sales tax was not collected and remitted and for which the State asserts that proper documentation of resale may not have been obtained and that the Company owes sales tax of $1.5 million , inclusive of interest. The Company contends and believes that it received sufficient and proper documentation from its customer to support not collecting and remitting sales tax from that customer and is actively disputing the audit report with the State. On August 12, 2013, the Company appeared at an appeals conference with the State Board of Equalization ("BOE"). On July 21, 2014, the Company received a Decision and Recommendation ("D&R") from the BOE. The D&R's conclusion was that the basis for the calculation of the aforementioned $1.5 million tax due should be reduced from $12.2 million to $9.0 million with a commensurate reduction in the tax owed to the State. Regardless of this finding, the Company continues to believe that it will prevail in this matter, as it believes that the State did not adequately address the legal arguments related to the Company's acceptance of the valid resale certificate from its customer. The Company has not agreed to these findings, and therefore, it will be appealing at a higher level at the BOE. Based on a re-audit, the BOE lowered the tax due to $0.9 million , inclusive of interest. The Company continues to disagree with these findings based on the aforementioned reasons. However, in October 2015, the Company offered to settle this case for $0.1 million , which is based on the expected cost of continuing to contest this audit. Accordingly, an accrual was charged to discontinued operations during the year ended December 31, 2015 to reflect the offer to settle this case. Should the Company not prevail with the offer to settle this case, it plans to continue with the appeals process. Further, should the Company not prevail in this case, it will pursue reimbursement from the customer for all assessments from the State. On November 15, 2013, BP Products North America ("BP") instituted claims against Johnson Matthey ("JM") as the parent company of and purchaser of Applied Utility Systems, Inc. ("AUS"), a former subsidiary of the Company. On May 12, 2010, JM tendered to the Company a claim for indemnification under the Asset Purchase Agreement dated October 1, 2009 (the "Asset Purchase Agreement") among JM, the Company and AUS. On June 11, 2013, BP, JM and the Company entered into a settlement agreement and mutual release pursuant to which they settled all claims. This settlement agreement had no material impact on the Company. Under the indemnification clauses of the Asset Purchase Agreement, the Company may be liable for legal expenses incurred by JM. These legal costs may be offset against funds withheld by JM from the acquisition of AUS. In connection with the Asset Purchase Agreement, on October 1, 2009, JM presented the Company with an indemnification claim seeking recovery of the net amount of $0.9 million after offsetting the funds withheld by JM from the acquisition of AUS. These claims were for matters relating to various customer contracts that JM purchased, including the BP contract discussed above. The Company and JM entered into discussions relating to the application of offsets and the validity of the claims presented. On June 3, 2015, JM and the Company entered into a settlement and release agreement pursuant to which they settled all claims for $0.7 million . This settlement was paid with an initial $0.1 million installment upon execution of the settlement and release agreement, and the remaining balance was paid in July 2015. The following table presents revenue and expense information for discontinued operations (in thousands): Years Ended 2016 2015 Revenue $ — $ — Expenses — (112 ) Net loss from discontinued operations $ — $ (112 ) |
Significant Accounting Polici28
Significant Accounting Policies - (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the financial statements of the Company and its wholly owned subsidiaries. All intercompany transactions, including intercompany profits and losses and intercompany balances, have been eliminated in consolidation. |
Discontinued Operations | Discontinued Operations When the Company commits to a plan to dispose of a component of the Company or a group of components of the Company, it is required to be reported in discontinued operations if the disposal represents a strategic shift that has (or will have) a major effect on the Company's operations and financial results when certain events have occurred as defined by ASU 2014-08 "Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity." A business' operations are classified as discontinued operations for all periods that would be presented. In the statements of cash flows, the cash flows of discontinued operations are separately classified and aggregated. Discontinued operations includes accruals and related costs for the Company's estimated liability to settle its ongoing indemnification matters with Johnson Matthey ("JM") associated with the sale of Applied Utility Systems, Inc. ("AUS"), a former subsidiary of the Company, in 2009. For additional information, refer to Note 21 , " Discontinued Operations ". All discussions and amounts in the consolidated financial statements and related notes for all periods presented relate to continuing operations only, unless otherwise noted. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the U.S requires management of the Company to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent liabilities. These estimates and assumptions are based on management's best estimates and judgment. On an ongoing basis, the Company evaluates its estimates and assumptions, including those related to impairment of goodwill and long-lived assets, stock-based compensation, the fair value of financial instruments including warrants, allowance for doubtful accounts, inventory valuation, taxes and contingent and accrued liabilities. The Company bases its estimates on historical experience and various other factors, including the current economic environment, which it believes to be reasonable under the circumstances. Estimates and assumptions are adjusted when facts and circumstances dictate. Actual results may differ from these estimates under different assumptions and conditions. Management believes that the estimates are reasonable. |
Cash | Cash Cash consists of cash balances on hand and on deposit at banks. Cash on deposit at banks at times may exceed the Federal Deposit Insurance Corporation (FDIC) limits. The Company believes no significant concentration of credit risk exists with respect to these cash balances. |
Accounts Receivable | Accounts Receivable Accounts receivable are recorded at the invoiced amount and do not bear interest. Accounts receivable are presented net of a reserve for doubtful accounts of $0.4 million and $0.3 million at December 31, 2016 and 2015 , respectively. The allowance for doubtful accounts is the Company's best estimate of the amount of probable credit losses in the Company's existing accounts receivable. The Company determines the allowance based on historical write-off experience and past due balances over 90 days that are reviewed individually for collectability. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. The Company does not have any off balance sheet credit exposure related to its customer. |
Inventories | Inventories Inventories are stated at the lower of cost (FIFO method) or market (net realizable value). Finished goods inventory includes materials, labor and manufacturing overhead. The Company establishes provisions for inventory that is obsolete or when quantities on hand are in excess of estimated forecasted demand. The creation of such provisions results in a write-down of inventory to net realizable value and a charge to cost of sales. The Company's inventory includes precious metals (platinum, palladium and rhodium) for use in the manufacturing of catalysts. The precious metals are valued at the lower of cost or market, consistent with the Company's other inventory. |
Property and Equipment | Property and Equipment Property and equipment is capitalized at cost and is stated at cost less accumulated depreciation and amortization. Depreciation and amortization is determined using the straight line method over the estimated useful lives of the various asset classes. Machinery and equipment are depreciated over 2 to 10 years; furniture and fixtures, computer hardware and software and vehicles are depreciated over 2 to 5 years. Property and equipment held under capital leases and leasehold improvements are amortized over the shorter of estimated useful lives or the lease term. Repairs and maintenance are charged to expense as incurred and major replacements or betterments are capitalized. |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill is the excess of the purchase price of an acquired entity over the fair value of net identified tangible and intangible assets acquired and is recorded in the reporting unit (operating segment or one level below operating segment) that is expected to benefit from the business combination. Goodwill is not amortized, but rather tested for impairment at least annually or more often whenever events or circumstances indicate that goodwill might be impaired. The Company performs its annual impairment test as of October 31. Goodwill is tested at the reporting unit level using a two-step impairment test. The first step is to compare the fair value of the reporting unit to its carrying value, including goodwill. If the carrying value of the reporting unit exceeds the fair value, a second step is performed in order to determine the amount of impairment loss, if any. The second step compares the implied fair value of the reporting unit's goodwill with the carrying amount of that goodwill. If the carrying amount of the reporting unit's goodwill exceeds its implied fair value, an impairment charge is recognized in an amount equal to that excess. Prior to performing the two-step impairment test, the Company may make a qualitative assessment of the likelihood of goodwill impairment in order to determine whether a detailed quantitative analysis is required. The Company's Engine Control Systems reporting unit, contains all of the Company's allocated goodwill. See note 15 for further discussion of the impairment which occurred in 2016. The Company's intangible assets consist of trade names, acquired patents and technology, and customer relationships and have finite lives. Intangible assets are carried at cost, less accumulated amortization. Amortization is computed on a straight-line or accelerated basis over the estimated useful lives of the respective assets, ranging from 4 to 20 years. |
Long Lived Assets | Long Lived Assets Assets such as property and equipment and amortizable intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment loss is recognized when the sum of the expected undiscounted future net cash flows of an asset or asset group is less than its carrying amount and is measured as the amount by which the carrying amount of the asset or asset group exceeds its fair value. |
Warrants and Derivative Liabilities | Warrants and Derivative Liabilities The Company accounts for the issuance of Company derivative equity instruments in accordance with Accounting Standards Codification ("ASC") 815-40 "Derivative and Hedging". The Company reviews common stock purchase warrants at each balance sheet date based upon the characteristics and provision of each particular instrument and classifies them on the balance sheet as equity or a liability. Below are some of the factors the Company considers with the corresponding balance sheet classification: • Equity if the awards (i) require physical settlement or net-share settlement, or (ii) give the Company a choice of net-cash settlement or settlement in the Company's own shares (physical settlement or net-share settlement), or as • Liabilities if the awards (i) require net-cash settlement (including a requirement to net-cash settle the contract if an event occurs and if that event is outside the Company's control), or (ii) give the counterparty a choice of net-cash settlement or settlement in shares (physical settlement of net-share settlement). The Company assesses classification of common stock purchase warrants and other freestanding derivatives at each reporting date to determine whether a change in classification between assets and liabilities and equity is required. |
Income Taxes | Income Taxes Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis and operating loss and tax credit carryforwards. 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 includes the enactment date. A valuation allowance against deferred tax assets is required if, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The valuation allowance should be sufficient to reduce the deferred tax assets to the amount that is more likely than not to be realized. The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained. Changes in recognition or measurement are reflected in the period in which the change occurs. The Company records interest and penalties related to unrecognized tax benefit in income tax expense. |
Revenue Recognition | Revenue Recognition Revenues are derived primarily from the sale of products. The Company generally recognizes revenue when products are shipped and the customer takes ownership and assumes risk of loss, collection of the relevant receivable is reasonably assured, persuasive evidence of an arrangement exists and the sales price is fixed or determinable. There are certain customers where risk of loss transfers at destination point and revenue is recognized when product is delivered to the destination. For these customers, revenue is recognized upon receipt at the customer's warehouse. When terms of sale include subjective customer acceptance criteria, the Company defers revenue until the acceptance criteria are met. The determination of whether or not the customer acceptance terms are perfunctory or inconsequential impacts the amount and timing of the revenue recognized. |
Research and Development | Research and Development Research and development costs are generally expensed as incurred. These expenses include the salary and benefits for the research and development staff as well as travel, research materials, testing and legal expense related to patenting intellectual property. Also included is any depreciation related to assets utilized in the development of new products. |
Stock-Based Compensation | Stock-Based Compensation Equity awards consist of stock options and restricted stock units ("RSUs"). The Company measures the compensation cost for all stock-based awards at fair value on the date of grant and recognizes it on a straight-line basis over the service period for awards expected to vest, which is generally three years. The Company measures the fair value of stock options using the Black-Scholes option-pricing model and certain assumptions, including the expected life of the stock options, an expected forfeiture rate and the expected volatility of its common stock. The fair value of RSUs is based on the closing price of the Company's common stock on the grant date. |
Product Warranty | Product Warranty The Company provides for the estimated cost of product warranties in cost of sales, at the time product revenue is recognized. Warranty costs are estimated primarily using historical warranty information in conjunction with current engineering assessments applied to the Company's expected repair or replacement costs. |
Foreign Currency | Foreign Currency The functional currency of the Heavy Duty Diesel Systems division's Engine Control Systems Limited subsidiary in Canada is the Canadian dollar, while that of its subsidiary Engine Control Systems Europe AB in Sweden is the Swedish krona and the division's Clean Diesel Technologies Limited U.K. subsidiary, is the British pound sterling. The functional currency of the Catalyst division's Japanese branch office and Asian investment is the Japanese Yen. Accordingly, the assets and liabilities of the foreign locations are translated into U.S. dollars at period-end exchange rates. Revenue and expense accounts are translated at the average exchange rates for the period. The resulting foreign currency exchange adjustments are charged or credited directly to other comprehensive income or loss as a separate component of stockholders' equity. Unrealized foreign currency exchange gains and losses on certain intercompany transactions that are of a long-term investment nature (i.e. settlement is not planned or anticipated in the foreseeable future) are also recorded in other comprehensive income or loss in stockholders' equity. Accumulated other comprehensive loss contained only foreign currency translation adjustments as of December 31, 2016 and 2015 . The Company has exposure to multiple currencies. The primary exposure is between the U.S. dollar, the Canadian dollar, the Euro, British pound sterling and Swedish krona. Gains and losses arising from transactions denominated in currencies other than the functional currency of the entity are included in other income (expense) in the consolidated statements of comprehensive loss. Gains and losses arising from transactions denominated in foreign currencies are primarily related to inter-company loans that have been determined to be temporary in nature, cash, accounts receivable and accounts payable denominated in non-functional currencies. |
Net Loss per Share | Net Loss per Share Basic net loss per share is computed using the weighted average number of common shares outstanding during the period. Diluted net loss per share is computed using the weighted average number of common shares and dilutive potential common shares. Dilutive potential common shares include employee stock options, RSUs, warrants and debt that are convertible into the Company's common stock. Diluted net loss per share excludes certain dilutive potential common shares outstanding as their effect is anti-dilutive. Because the Company incurred net losses in the years ended December 31, 2016 and 2015 , the effect of potentially dilutive securities has been excluded in the computation of net loss per share as their impact would be anti-dilutive. |
Fair Value Measurements | Fair Value Measurements Fair value is defined as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset and liability. As a basis for considering such assumptions, a fair value hierarchy has been established that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1 measurement) and the lowest priority to unobservable inputs (level 3 measurements). The three levels of the fair value hierarchy are as follows: • Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities; • Level 2: Inputs other than quoted prices included within Level 1 that are either directly or indirectly observable including quoted prices for similar instruments in active markets and quoted prices for identical or similar instruments in markets that are not active; and • Level 3: Unobservable inputs in which little or no market activity exists, therefore requiring an entity to develop its own assumptions about the assumptions that market participants would use in pricing. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments ASC Topic 825, "Financial Instruments", requires disclosure of the fair value of financial instruments for which the determination of fair value is practicable. The fair values of the Company's cash, trade accounts receivable, prepaid expenses and other current assets, accounts payable and accrued expenses and other current liabilities approximate carrying values due to the short maturity of these instruments. The fair value of borrowings under the line of credit approximates their carrying value due to the variable interest rates. The fair value of shareholder notes payable, calculated using level 3 inputs, and a net present value model, was $1.8 million and $7.6 million at December 31, 2016 and 2015 , respectively. |
Reclassifications | Reclassifications Certain prior-period amounts have been reclassified to conform to the current period presentation. These changes had no impact on the previously reported consolidated results of operations or stockholders' equity. |
Recently Issued Accounting Guidance | Recently Issued Accounting Guidance In May 2014, the Financial Accounting Standards Board ("FASB") issued ASU No. 2014-9, "Revenue from Contracts with Customers (Topic 606)". ASU No. 2014-9 supersedes the revenue recognition requirements in "Revenue Recognition (Topic 605)". ASU No. 2014-9 requires entities to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. In July 2015, the FASB finalized the delay of the effective date by one year, making the new standard effective for interim periods and annual periods beginning after December 15, 2017. Early adoption is permitted, but it is not permitted earlier than the original effective date. ASU No. 2014-9 provides for either full retrospective adoption or a modified retrospective adoption by which it is applied only to the most current period presented. While the Company has not finalized the impact of the adoption of ASU No. 2014-9 on its consolidated financial statements, the Company does not expect the adoption to have a material impact. In August 2014, the FASB issued ASU No. 2014-15, "Presentation of Financial Statements-Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern". ASU No. 2014-15 defines management's responsibility to assess an entity's ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. It is effective for annual reporting periods ending after December 15, 2016, and for annual and interim reporting periods thereafter. Early adoption is permitted. The Company has elected to early adopt the provision and has provided the appropriate disclosure in Note 2. In April 2015, the FASB issued ASU No. 2015-03, " Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs" which requires companies to present debt issuance costs the same way they currently present debt discounts, as a direct deduction from the carrying value of that debt liability. ASU No. 2015-03 does not impact the recognition and measurement guidance for debt issuance costs. The provisions in this ASU are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2015. Early adoption is allowed for all entities for financial statements that have not been previously issued. Entities would apply the new guidance retrospectively to all prior periods (i.e., the balance sheet for each period is adjusted). The adoption of this provision did not have a material impact on the consolidated financial statements. In July 2015, the FASB issued ASU No. 2015-11, "Inventory (Topic 330): Simplifying the Measurement of Inventory". ASU No. 2015-11 changes the measurement principle for inventory from the "lower of cost or market" to "lower of cost and net realizable value." Net realizable value is defined as the "estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation." ASU No. 2015-11 eliminates the guidance that entities consider replacement cost or net realizable value less an approximately normal profit margin in the subsequent measurement of inventory when cost is determined on a first-in, first-out or average cost basis. It is effective for annual reporting periods beginning after December 15, 2016, including interim periods within those fiscal years. Early adoption is permitted. The Company has not yet determined whether it will elect to early adopt ASU No. 2015-11, and it is currently in the process of evaluating the impact of the adoption of ASU No. 2015-11 on its consolidated financial statements. In January 2016, FASB issued ASU No. 2016-1, "Recognition and Measurement of Financial Assets and Financial Liabilities". ASU No. 2016-1 requires equity investments to be measured at fair value with changes in fair value recognized in net income; simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment; eliminates the requirement for public business entities to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet; requires public business entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes; requires an entity to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments; requires separate presentation of financial assets and financial liabilities by measurement category and form of financial assets on the balance sheet or the accompanying notes to the financial statements and clarifies that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity's other deferred tax assets. ASU No. 2016-1 is effective for financial statements issued for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. The Company is currently in the process of evaluating the impact of the adoption of ASU No. 2016-1 on its consolidated financial statements. In February 2016, the FASB issued ASU 2016-2, "Leases (Topic 842)." ASU No. 2016-2 requires the recognition of lease assets and lease liabilities by lessees for those leases classified as operating leases under previous U.S. generally accepted accounting principles. It is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. Entities are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The Company is evaluating the impact of adoption of ASU No. 2016-2 on its consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, “Compensation - Stock Compensation: Improvements to Employee Share-Based Payment Accounting”. ASU No. 2016-09 will change how companies account for certain aspects of share-based payments to employees. Entities will be required to recognize the income tax effects of awards in the statement of income when the awards vest or are settled, the guidance on employers’ accounting for an employee’s use of shares to satisfy the employer’s statutory income tax withholding obligation and for forfeitures is changing and the update requires companies to present excess tax benefits as an operating activity on the statement of cash flows rather than as a financing activity. ASU No. 2016-09 is effective for annual periods beginning after December 15, 2016 and interim periods within those annual periods. Early adoption is permitted. The Company adopted ASU No. 2016-09 in the first quarter of 2017. The adoption of this provision did not have a material impact on its consolidated financial statements. In August 2016, the FASB issued ASU 2016-15, “Classification of Certain Cash Receipts and Cash Payments: a consensus of the Emerging Task Force.” ASU 2016-15 provides guidance on how certain cash receipts and payments are presented and classified in the statement of cash flows, including debt prepayment or debt extinguishment costs, contingent consideration payments made after a business combination, and separately identifiable cash flows and application of the predominance principle. The standard is intended to reduce current diversity in practice. The standard will be effective for annual reporting periods beginning after December 15, 2017, including interim periods within those reporting periods. Early adoption is permitted. The Company has not yet evaluated the impact of the adoption of this accounting standard update on its consolidated financial statements. In October 2016, the FASB issued ASU 2016-16, “Intra-Entity Transfers of Assets of Other Than Inventory.” Current GAAP prohibits the recognition of current and deferred income taxes for an intra-entity asset transfer until the asset has been sold to an outside party. ASU 2016-16 updates the current guidance by requiring that entities recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. The amendments in this ASU do not change GAAP for the pre-tax effects of an intra-entity asset transfer under Topic 810, Consolidation, or for the income tax effects of an intra-entity transfer of inventory. The standard will be effective for annual reporting periods beginning after December 15, 2017, including interim periods within those reporting periods. Early adoption is permitted. The Company is currently evaluating the impact of the adoption of this accounting standard on its consolidated financial statements. |
Inventories - (Tables)
Inventories - (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventories consist of the following (in thousands): December 31, 2016 2015 Raw materials $ 3,291 $ 3,894 Work in process 790 844 Finished goods 3,044 3,180 $ 7,125 $ 7,918 |
Property and Equipment - (Table
Property and Equipment - (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment consists of the following (in thousands): December 31, 2016 2015 Buildings and improvements $ — $ 195 Furniture and fixtures 2,124 2,248 Computer hardware and software 1,228 1,370 Machinery and equipment 11,078 11,961 Vehicles 31 86 14,461 15,860 Less accumulated depreciation (13,303 ) (14,322 ) $ 1,158 $ 1,538 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets - (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets | Intangible assets consist of the following (in thousands): Useful Life December 31, 2016 2015 Trade name 15 - 20 $ 1,204 $ 1,186 Patents and know-how 5 - 12 4,090 4,002 Customer relationships 4 - 8 721 724 6,015 5,912 Less accumulated amortization (4,532 ) (4,011 ) $ 1,483 $ 1,901 |
Schedule of Estimated Amortization Expense | Estimated amortization expense for existing intangible assets for each of the next five years is as follows (in thousands): Years ending December 31: 2017 $ 435 2018 $ 161 2019 $ 161 2020 $ 161 2021 $ 161 Thereafter $ 404 $ 1,483 |
Accrued Expenses and Other Cu32
Accrued Expenses and Other Current Liabilities - (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Accrued Expenses and Other Current Liabilities | |
Schedule of Accrued Expenses and Other Current Liabilities | Accrued expenses and other current liabilities consist of the following (in thousands): December 31, 2016 2015 Accrued salaries and benefits $ 759 $ 1,332 Accrued severance and other charges(1) 1,738 1,092 Accrued warranty(2) 338 228 Warrant liability(3) 1,226 3,072 Liability for consigned precious metals 1,282 543 Other 1,002 1,587 $ 6,345 $ 7,854 _______________________________________________________________________________ (1) For additional information, refer to Note 8 , " Severance and Other Charges ". (2) For additional information, refer to Note 9 , " Accrued Warranty ". (3) For additional information, refer to Note 13, " Fair Value Measurements ". |
Severance and Other Charges - (
Severance and Other Charges - (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Severance, Exit and Other Charges | Severance, exit and other charges consist of the following (in thousands): Years Ended 2016 2015 Employee severance expense $ 1,227 $ 1,210 Other closure costs — 272 Lease exit costs 1,328 — Total severance and other charges $ 2,555 $ 1,482 |
Schedule of Accrual for Severance and Other Exit Costs | The following summarizes the activity in the Company's accrual for severance and other exit costs (in thousands): Severance Lease Exit Total December 31, 2014 $ 293 $ 42 $ 335 Provision 1,210 — 1,210 Payments (411 ) (42 ) (453 ) December 31, 2015 $ 1,092 $ — $ 1,092 Provision 1,227 1,328 2,555 Payments (1,601 ) (308 ) (1,909 ) December 31, 2016(1) $ 718 $ 1,020 $ 1,738 _______________________________________________________________________________ (1) The Company expects to pay this accrual during the year ended December 31, 2017 . |
Accrued Warranty - (Tables)
Accrued Warranty - (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Product Warranties Disclosures [Abstract] | |
Schedule of Accrual for Product Warranty | The following summarizes the activity in the Company's accrual for product warranty (in thousands): Years Ended 2016 2015 Balance at beginning of period $ 228 $ 373 Accrued warranty expense 431 301 Warranty claims paid (324 ) (389 ) Translation adjustment 3 (57 ) Balance at end of period $ 338 $ 228 |
Debt - (Tables)
Debt - (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | Debt consists of the following (in thousands): December 31, 2016 December 31, 2015 Line of credit with FGI $ 1,458 $ 3,513 $2.0 million, 8% shareholder note due 2017 (1) 1,803 — $1.5 million, 8% shareholder note due 2018 (2) — 1,623 $3.0 million, 8% subordinated convertible shareholder notes due 2018 (2) — 2,972 $3.0 million, 8% shareholder note due 2018 (2) — 2,964 3,261 11,072 Less current portion (3,261 ) (3,513 ) $ — $ 7,559 _______________________________________________________________________________ (1) Debt discount related to extinguishment and amendment of previous outstanding debt. The aggregate amount of unamortized debt discount was $0.2 million at December 31, 2016. For additional information, refer to the respective discussions below. (2) Debt discounts relate to warrants issued with shareholder notes and amendments. The aggregate amount of unamortized debt discount was $0.1 million at December 31, 2015 . For additional information, refer to the respective discussions below. Debt consists of the following (in thousands): December 31, 2016 December 31, 2015 Line of credit with FGI $ 1,458 $ 3,513 $2.0 million, 8% shareholder note due 2017 (1) 1,803 — $1.5 million, 8% shareholder note due 2018 (2) — 1,623 $3.0 million, 8% subordinated convertible shareholder notes due 2018 (2) — 2,972 $3.0 million, 8% shareholder note due 2018 (2) — 2,964 3,261 11,072 Less current portion (3,261 ) (3,513 ) $ — $ 7,559 _______________________________________________________________________________ (1) Debt discount related to extinguishment and amendment of previous outstanding debt. The aggregate amount of unamortized debt discount was $0.2 million at December 31, 2016. For additional information, refer to the respective discussions below. (2) Debt discounts relate to warrants issued with shareholder notes and amendments. The aggregate amount of unamortized debt discount was $0.1 million at December 31, 2015 . For additional information, refer to the respective discussions below. |
Schedule of Principal Payments of Debt | Annual scheduled principal payments of debt based on earliest redemption date as of December 31, 2016 are (in thousands): Years ending December 31: 2017 $ 3,458 2018 — Total $ 3,458 Annual scheduled principal payments of debt based on earliest redemption date as of December 31, 2016 are (in thousands): Years ending December 31: 2017 $ 3,458 2018 — Total $ 3,458 |
Warrants - (Tables)
Warrants - (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Class of Warrant or Right [Line Items] | |
Schedule of Warrants Activity | Warrants activity is summarized as follows: Shares(1) Weighted Average Exercise Price Range of Exercise Prices Outstanding at December 31, 2014 322,011 $ 17.71 $6.25 - $52.00 Issued 591,423 $ 4.50 $0.05 - $6.25 Exchange warrants issued 171,276 $ 8.50 8.50 Exchange warrants surrendered (171,276 ) $ 15.95 $13.25 - $21.00 Outstanding at December 31, 2015 913,434 $ 3.54 $6.25 - $52.00 (2) Issued 489,475 $ 2.20 $2.20 Exercised (410,824 ) $ 1.73 $0.05 - $3.00 Expired (12,216 ) $ 22.50 $22.50 Outstanding at December 31, 2016 979,869 $ 6.36 $0.05 - $21.00 Exercisable at December 31, 2016 979,869 $ 6.36 $6.25 - $21.00 _______________________________________________________________________________ (1) Outstanding and exercisable information includes 21,920 equity-classified warrants as of December 31, 2016 . (2) Includes the effects of repricing. Refer to the November 2015 Offering in Note 11 " Stockholders' Equity ." |
Black Scholes | |
Class of Warrant or Right [Line Items] | |
Schedule of of Ranges of Warrant Valuation Assumptions | The assumptions used in the Black-Scholes option-pricing model to estimate the fair value of the warrant liability as of December 31, 2016 were as follows: Expected volatility 97.7% - 106.4% Risk-free interest rate 1.40% - 1.92% Dividend yield — Expected life in years 2.8 - 5.0 |
Monte Carlo Simulation Model | |
Class of Warrant or Right [Line Items] | |
Schedule of of Ranges of Warrant Valuation Assumptions | The assumptions used in the Monte Carlo simulation model to estimate the fair value of the warrant liability as of December 31, 2016 were as follows: Expected volatility 97.7%-106.4% Risk-free interest rate 1.03%-1.43% Dividend yield — Expected life in years 1.5-2.9 |
Fair Value Measurements - (Tabl
Fair Value Measurements - (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | Assets and liabilities measured at fair value on the Company’s balance sheet on a recurring basis include the following at December 31, 2016 and December 31, 2015 (in thousands): Warrant Liability Level 1 Level 2 Level 3 December 31, 2016 — — $ 1,226 December 31, 2015 — — $ 3,072 |
Schedule of Reconciliation of Warrants Liability | The following is a reconciliation of the warrant liability, included in accrued expenses and other current liabilities in the accompanying unaudited condensed consolidated balance sheets, measured at fair value using Level 3 inputs (in thousands): Years Ended 2016 2015 Balance at beginning of period $ 3,072 $ 1,474 Issuance of common stock warrants 858 4,215 Exercise of common stock warrants (1,150 ) — Gain on change in fair value (1,554 ) (2,617 ) Balance at end of period $ 1,226 $ 3,072 |
Schedule of Reconciliation of Embedded Derivatives | The following is a reconciliation of the embedded bifurcated derivative liability measured at fair value using significant unobservable inputs, Level 3 (in thousands): Years Ended December 31, 2016 2015 Balance at beginning of period $ — $ — Transfers in and/or out of Level 3 — — Initial valuation of bifurcated derivative liability 3,936 — Extinguishment of bifurcated derivative liability (3,936 ) — Balance at end of period $ — $ — |
Stock-Based Compensation - (Tab
Stock-Based Compensation - (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Stock Option Activity | Stock option activity is summarized as follows: Options Weighted Weighted Aggregate Outstanding at December 31, 2015 256,963 $ 20.01 7.7 — Granted 875,000 $ 2.24 — — Cancelled (24,500 ) $ 8.47 — — Vested shares expired (34,175 ) $ 36.68 — $ — Outstanding at December 31, 2016 1,073,288 $ 5.26 9.4 $ 5,500 Exercisable at December 31, 2016 471,374 $ 8.82 8.8 $ 2,750 |
Schedule of Weighted-Average Grant Date Fair Value | The weighted-average assumptions and grant date fair value for the options granted during year ended December 31, 2016 were as follows: Years Ended December 31, 2016 2015 Expected volatility 153.7% - 168.5% 126.0 % Risk-free interest rate 1.19% - 2.18% 1.7 % Dividend yield — — Expected life in years 6.0 5.4 Weighted average grant date fair value $ 2.12 $ 7.60 |
Schedule of Restricted Stock Unit Activity | RSU activity is as follows: Shares Weighted Nonvested at December 31, 2015 39,405 $ 12.55 Granted 5,789 $ 2.64 Vested (28,806 ) $ 11.38 Forfeited (3,999 ) $ 13.05 Nonvested units at December 31, 2016 12,389 $ 10.50 |
Income Taxes - (Tables)
Income Taxes - (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income (Loss) from Continuing Operations Before Income Taxes | Income (loss) from continuing operations before income taxes include the following components (in thousands): Years Ended 2016 2015 U.S.-based operations $ (17,344 ) $ (7,770 ) Non U.S.-based operations (7,088 ) (1,051 ) $ (24,432 ) $ (8,821 ) |
Schedule of Income Tax Expense (Benefit) | Income tax expense (benefit) attributable to loss from continuing operations is summarized as follows (in thousands): Current Deferred Total Year ended December 31, 2016: State and local $ 22 $ — $ 22 Foreign (210 ) (770 ) (980 ) Total $ (188 ) $ (770 ) $ (958 ) Year ended December 31, 2015: U.S. Federal $ — $ — $ — State and local 4 — 4 Foreign (269 ) (134 ) (403 ) Total $ (265 ) $ (134 ) $ (399 ) |
Reconciliation of Expected Income Tax Expense to Actual Income Tax Expense | Income taxes attributable to loss from continuing operations differ from the amounts computed by applying the U.S. federal statutory rate of 34% to loss from continuing operations before income taxes as shown below (in thousands): Years Ended 2016 2015 Expected tax benefit $ (8,307 ) $ (2,999 ) Net tax effects of: Foreign tax rate differential 1,331 167 State taxes, net of federal benefit 219 (602 ) Return to provision adjustment 13,386 (619 ) Research and other credits 443 (59 ) Permanent difference on convertible notes and warrants 2,923 (589 ) Goodwill impairment 533 — Other 61 52 Change in deferred tax asset valuation allowance (11,547 ) 4,250 $ (958 ) $ (399 ) |
Schedule of Deferred Tax Assets and Liabilities | Deferred tax assets and liabilities consist of the following (in thousands): December 31, 2016 2015 Deferred tax assets: Research and development credits $ 2,063 $ 2,763 Other credits — 487 Operating loss carry forwards 7,320 17,249 Interest 460 — Inventories 289 254 Allowance for doubtful accounts 129 116 Depreciation 353 382 Deferred research and development expenses for income tax — 240 Non-cash compensation 946 1,120 Other 929 921 Total gross deferred tax assets 12,489 23,532 Valuation allowance (11,441 ) (23,091 ) Net deferred tax assets $ 1,048 $ 441 Deferred tax liabilities: Other identifiable intangible assets $ (494 ) $ (634 ) Total gross deferred tax liabilities (494 ) (634 ) Net deferred tax assets (liabilities) $ 554 $ (193 ) |
Schedule of Changes in Unrecognized Tax Benefits Including Related Interest and Penalties | The following changes occurred in the amount of unrecognized tax benefits including related interest and penalties, included in the income taxes payable on the consolidated balance sheet (in thousands): Years Ended 2016 2015 Balance at beginning of year $ 634 $ 683 Additions for current year tax provisions 49 32 Additions/Reduction for tax positions of prior years 786 — Reduction for prior year tax provisions — (81 ) Balance at end of year $ 1,469 $ 634 |
Schedule of Tax Years Open to Examination | The following tax years remain open to examination by the major domestic taxing jurisdictions to which it is subject: Open Tax Years United States—Federal 2013 - 2016 United States—State 2012 - 2016 Canada 2011 - 2016 Sweden 2014 - 2016 United Kingdom 2012 - 2016 |
Commitments and Contingencies -
Commitments and Contingencies - (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Lease Payments Under Non-Cancelable Operating Leases | Future minimum lease payments under non-cancelable operating leases (with initial or remaining lease terms in excess of one year) as of December 31, 2016 are (in thousands): Years ending December 31: 2017 $ 501 2018 462 2019 2 2020 1 2021 and thereafter — Total minimum lease payments $ 966 |
Geographic Information - (Table
Geographic Information - (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Schedule of Net Sales and Fixed Assets and Total Assets by Geographic Region | Net sales by geographic region based on location of sales organization is as follows (in thousands): Years Ended 2016 2015 United States $ 23,870 $ 24,323 Canada 9,583 12,143 Europe 3,386 3,272 Total international 12,969 15,415 Total revenues $ 36,839 $ 39,738 Property and equipment, net and total assets by geographic region as of December 31, 2016 and 2015 is as follows (in thousands): Property and Equipment, net Total Assets 2016 2015 2016 2015 United States $ 1,082 $ 1,247 $ 15,126 $ 11,266 Canada 71 290 8,352 11,641 Europe 5 1 1,352 2,195 Total international 76 291 9,704 13,836 Total $ 1,158 $ 1,538 $ 24,830 $ 25,102 |
Concentrations - (Tables)
Concentrations - (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Risks and Uncertainties [Abstract] | |
Schedules of Concentration of Risk, by Risk Factor | For the year ended December 31, 2016, the Company had one supplier that accounted for approximately 30% of the Company's material purchases. For the year ended December 31, 2015, the Company had two suppliers that accounted for approximately 58% of the Company's material purchases. |
Supplementary Cash Flow Infor43
Supplementary Cash Flow Information - (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of Cash Flow, Supplemental Disclosures | Supplementary cash flow information for 2016, and 2015 is as follows (in thousands): Years Ended 2016 2015 Cash paid for interest 694 1,075 Cash paid for income taxes 43 227 Non-cash operating and financing activities Kanis S.A. notes payable plus accrued interest settled with common stock (Note 10) 7,900 — Haldor Topsøe note payable settled with common stock (Note 10) 1,250 — Director Note payable plus accrued interest settled with common stock (Note 10) 515 — Issuance of common stock to placement agent in connection with equity offering (Note 11) 5 — Issuance of warrants to placement agent in connection with equity offering (Note 11) 857 — Accounts Payable settled with common stock 184 — |
Discontinued Operations - (Tabl
Discontinued Operations - (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of Discontinued Operations | The following table presents revenue and expense information for discontinued operations (in thousands): Years Ended 2016 2015 Revenue $ — $ — Expenses — (112 ) Net loss from discontinued operations $ — $ (112 ) |
Liquidity and Going Concern - (
Liquidity and Going Concern - (Details) - USD ($) | Dec. 16, 2016 | Nov. 04, 2016 | Aug. 31, 2016 | Aug. 30, 2016 | Aug. 25, 2016 | Dec. 16, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Jun. 30, 2016 | Apr. 11, 2016 | Apr. 01, 2016 | May 19, 2015 | Dec. 31, 2013 | Feb. 14, 2011 |
Liquidity and Going Concern [Line Items] | ||||||||||||||
Accumulated deficit | $ 223,063,000 | $ 199,589,000 | ||||||||||||
Cash | $ 7,839,000 | $ 2,958,000 | $ 7,220,000 | |||||||||||
Common Stock | ||||||||||||||
Liquidity and Going Concern [Line Items] | ||||||||||||||
Shares issued | 5,662,000 | 677,000 | ||||||||||||
November 2016 Offering | Common Stock | ||||||||||||||
Liquidity and Going Concern [Line Items] | ||||||||||||||
Gross proceeds from equity offerings | $ 8,400,000 | $ 1,900,000 | $ 10,300,000 | |||||||||||
Share price (in dollars per share) | $ 2 | $ 2 | ||||||||||||
Shares issued | 4,222,290 | 949,960 | 5,172,250 | |||||||||||
Additional underwriting discounts and commissions and offering costs allocated to warrants | $ 100,000 | |||||||||||||
Replacement Shelf | ||||||||||||||
Liquidity and Going Concern [Line Items] | ||||||||||||||
Authorized amount | $ 50,000,000 | |||||||||||||
Shelf registration securities sold | $ 3,100,000 | |||||||||||||
Kanis Agreement | ||||||||||||||
Liquidity and Going Concern [Line Items] | ||||||||||||||
Liquidity event discount rate | 25.00% | |||||||||||||
Bell Exchange Agreement | ||||||||||||||
Liquidity and Going Concern [Line Items] | ||||||||||||||
Extinguishment of debt, amount | $ 500,000 | |||||||||||||
Note Purchase Agreement With Haldor Topsøe | ||||||||||||||
Liquidity and Going Concern [Line Items] | ||||||||||||||
Debt conversion, shares issued | 462,535 | |||||||||||||
Extinguishment of debt, amount | $ 750,000 | $ 500,000 | ||||||||||||
Convertible Debt | ||||||||||||||
Liquidity and Going Concern [Line Items] | ||||||||||||||
Debt conversion, shares issued | 5,500,000 | |||||||||||||
Extinguishment of debt, amount | $ 8,900,000 | |||||||||||||
Convertible Debt | Kanis Promissory Note | ||||||||||||||
Liquidity and Going Concern [Line Items] | ||||||||||||||
Face amount of debt | $ 2,000,000 | $ 2,000,000 | $ 2,000,000 | |||||||||||
Interest rate (as a percent) | 8.00% | 8.00% | 8.00% | |||||||||||
Convertible Debt | Kanis Agreement | ||||||||||||||
Liquidity and Going Concern [Line Items] | ||||||||||||||
Aggregate principal amount outstanding | 7,500,000 | $ 7,500,000 | $ 7,500,000 | |||||||||||
Conversion price (in dollars per share) | $ 3.60 | $ 1.6215 | $ 3.60 | |||||||||||
Liquidity event discount rate | 25.00% | 25.00% | ||||||||||||
Extinguishment of debt, amount | 7,900,000 | |||||||||||||
Convertible Debt | Bell Director Note | ||||||||||||||
Liquidity and Going Concern [Line Items] | ||||||||||||||
Face amount of debt | $ 500,000 | |||||||||||||
Interest rate (as a percent) | 8.00% | |||||||||||||
Liquidity event discount rate | 25.00% | |||||||||||||
Convertible Debt | Bell Exchange Agreement | ||||||||||||||
Liquidity and Going Concern [Line Items] | ||||||||||||||
Aggregate principal amount outstanding | $ 500,000 | |||||||||||||
Extinguishment of debt, amount | $ 500,000 | |||||||||||||
Convertible Debt | Senior Convertible Promissory Note | ||||||||||||||
Liquidity and Going Concern [Line Items] | ||||||||||||||
Convertible notes payable | $ 750,000 | |||||||||||||
Extinguishment of debt, amount | $ 750,000 | |||||||||||||
Convertible Debt | Convertible Promissory Note | ||||||||||||||
Liquidity and Going Concern [Line Items] | ||||||||||||||
Convertible notes payable | $ 500,000 | |||||||||||||
Line of Credit | Line of Credit with FGI | ||||||||||||||
Liquidity and Going Concern [Line Items] | ||||||||||||||
Maximum borrowing capacity | $ 7,500,000 | $ 7,500,000 | ||||||||||||
Borrowings outstanding | 1,500,000 | |||||||||||||
Available borrowing capacity | $ 6,000,000 | |||||||||||||
Interest rate (as a percent) | 6.50% |
Significant Accounting Polici46
Significant Accounting Policies - Accounts Receivable (Details) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Accounting Policies [Abstract] | ||
Reserve for doubtful accounts | $ 0.4 | $ 0.3 |
Significant Accounting Polici47
Significant Accounting Policies - Property and Equipment (Details) | 12 Months Ended |
Dec. 31, 2016 | |
Machinery and equipment | Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful life | 2 years |
Machinery and equipment | Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful life | 10 years |
Vehicles | Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful life | 2 years |
Vehicles | Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful life | 5 years |
Furniture and fixtures | Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful life | 2 years |
Furniture and fixtures | Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful life | 5 years |
Computer hardware and software | Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful life | 2 years |
Computer hardware and software | Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful life | 5 years |
Significant Accounting Polici48
Significant Accounting Policies - Goodwill and Intangible Assets (Details) | 12 Months Ended |
Dec. 31, 2016 | |
Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful life | 4 years |
Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful life | 20 years |
Significant Accounting Polici49
Significant Accounting Policies - Stock Based Compensation (Details) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Stock-based compensation vesting period | 3 years |
Significant Accounting Polici50
Significant Accounting Policies - Net Loss Per Share (Details) - shares shares in Millions | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Accounting Policies [Abstract] | ||
Potentially dilutive common stock equivalents excluded from computation (in shares) | 2.1 | 1.2 |
Significant Accounting Polici51
Significant Accounting Policies - Fair Value of Financial Instruments (Details) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Accounting Policies [Abstract] | ||
Fair value of shareholder notes payable | $ 1.8 | $ 7.6 |
Significant Accounting Polici52
Significant Accounting Policies - Reclassifications (Details) $ in Thousands | 3 Months Ended | |||
Jun. 30, 2016segment | Mar. 31, 2016segment | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | |
Property, Plant and Equipment [Line Items] | ||||
Number of reportable segments | segment | 1 | 2 | ||
Income taxes payable | $ 642 | $ 534 | ||
Reclassification | ||||
Property, Plant and Equipment [Line Items] | ||||
Income taxes payable |
Inventories - (Details)
Inventories - (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 3,291 | $ 3,894 |
Work in process | 790 | 844 |
Finished goods | 3,044 | 3,180 |
Total inventories | $ 7,125 | $ 7,918 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 14,461 | $ 15,860 |
Less accumulated depreciation | (13,303) | (14,322) |
Property and equipment, net | 1,158 | 1,538 |
Buildings and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 0 | 195 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 2,124 | 2,248 |
Computer hardware and software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 1,228 | 1,370 |
Machinery and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 11,078 | 11,961 |
Vehicles | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 31 | $ 86 |
Property and Equipment - Deprec
Property and Equipment - Depreciation (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation | $ 0.3 | $ 0.4 |
Goodwill and Intangible Asset56
Goodwill and Intangible Assets - Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | $ 6,015 | $ 5,912 |
Less accumulated amortization | (4,532) | (4,011) |
Intangible assets, net | 1,483 | 1,901 |
Trade name | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | 1,204 | 1,186 |
Patents and know-how | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | 4,090 | 4,002 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible assets, gross | $ 721 | $ 724 |
Minimum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful life | 4 years | |
Minimum | Trade name | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful life | 15 years | |
Minimum | Patents and know-how | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful life | 5 years | |
Minimum | Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful life | 4 years | |
Maximum | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful life | 20 years | |
Maximum | Trade name | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful life | 20 years | |
Maximum | Patents and know-how | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful life | 12 years | |
Maximum | Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Useful life | 8 years |
Goodwill and Intangible Asset57
Goodwill and Intangible Assets - Amortization Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization of intangible assets | $ 500 | $ 600 |
Estimated amortization expense for each of the next five years | ||
2,017 | 435 | |
2,018 | 161 | |
2,019 | 161 | |
2,020 | 161 | |
2,021 | 161 | |
Thereafter | 404 | |
Finite-lived intangible assets, net | $ 1,483 |
Goodwill and Intangible Asset58
Goodwill and Intangible Assets Goodwill and Intangible Assets - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Goodwill | $ 0 | $ 0 | $ 4,659 |
Goodwill impairment | $ 4,700 | $ 4,675 | $ 0 |
Accrued Expenses and Other Cu59
Accrued Expenses and Other Current Liabilities - (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Accrued Expenses and Other Current Liabilities | |||
Accrued salaries and benefits | $ 759 | $ 1,332 | |
Accrued severance and other charges | 1,738 | 1,092 | |
Accrued warranty | 338 | 228 | $ 373 |
Warrant liability | 1,226 | 3,072 | |
Liability for consigned precious metals | 1,282 | 543 | |
Other | 1,002 | 1,587 | |
Accrued expenses and other current liabilities | $ 6,345 | $ 7,854 |
Severance and Other Charges - S
Severance and Other Charges - Severance, Exit and Other Charges (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Restructuring Cost and Reserve [Line Items] | ||
Total severances and other charges | $ 2,555 | $ 1,482 |
Provision for restructuring | 2,555 | 1,210 |
Canada | ||
Restructuring Cost and Reserve [Line Items] | ||
Provision for restructuring | 600 | |
Former President and Chief Operating Officer, General Counsel, Corporate Secretary and Vice President, and Administration | ||
Restructuring Cost and Reserve [Line Items] | ||
Severance costs | $ 800 | |
Severance period benefit coverage | 1 year | |
Employee severance expense | ||
Restructuring Cost and Reserve [Line Items] | ||
Total severances and other charges | 1,227 | $ 1,210 |
Provision for restructuring | 1,227 | 1,210 |
Other closure costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Total severances and other charges | 0 | 272 |
Lease exit costs | ||
Restructuring Cost and Reserve [Line Items] | ||
Total severances and other charges | 1,328 | 0 |
Provision for restructuring | $ 1,328 | $ 0 |
Severance and Other Charges - A
Severance and Other Charges - Accrual for Severance and Other Exit Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Accrual for severance and other exit costs | ||
Balance beginning of period | $ 1,092 | $ 335 |
Provision | 2,555 | 1,210 |
Payments | (1,909) | (453) |
Balance end of period | 1,738 | 1,092 |
Employee severance expense | ||
Accrual for severance and other exit costs | ||
Balance beginning of period | 1,092 | 293 |
Provision | 1,227 | 1,210 |
Payments | (1,601) | (411) |
Balance end of period | 718 | 1,092 |
Lease exit costs | ||
Accrual for severance and other exit costs | ||
Balance beginning of period | 0 | 42 |
Provision | 1,328 | 0 |
Payments | (308) | (42) |
Balance end of period | $ 1,020 | $ 0 |
Accrued Warranty - (Details)
Accrued Warranty - (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Accrued Warranty | ||
Balance beginning of period | $ 228 | $ 373 |
Accrued warranty expense | 431 | 301 |
Warranty claims paid | (324) | (389) |
Translation adjustment | 3 | (57) |
Balance end of period | $ 338 | $ 228 |
Minimum | ||
Accrued Warranty [Line Items] | ||
Product warranty accrual warranty period | 1 year | |
Maximum | ||
Accrued Warranty [Line Items] | ||
Product warranty accrual warranty period | 5 years |
Debt - Long-term and Short-term
Debt - Long-term and Short-term, Combined (Details) - USD ($) | Dec. 31, 2016 | Apr. 01, 2016 | Dec. 31, 2015 |
Debt, long-term and short-term, combined amount | |||
Total debt | $ 3,261,000 | $ 11,072,000 | |
Less current portion | (3,261,000) | (3,513,000) | |
Long-term debt, net of current portion | $ 0 | 7,559,000 | |
Line of Credit with FGI | Line of Credit | |||
Debt, long-term and short-term, combined amount | |||
Interest rate (as a percent) | 6.50% | ||
Total debt | $ 1,458,000 | 3,513,000 | |
Multiple Shareholder Notes Due 2018 [Member] | |||
Debt, long-term and short-term, combined amount | |||
Unamortized debt discount | 100,000 | ||
Convertible Debt | 2.0 million 8% shareholder note due 2017 | |||
Debt, long-term and short-term, combined amount | |||
Face amount of debt | $ 2,000,000 | $ 2,000,000 | $ 2,000,000 |
Interest rate (as a percent) | 8.00% | 8.00% | 8.00% |
Total debt | $ 1,803,000 | $ 0 | |
Unamortized debt discount | 200,000 | ||
Convertible Debt | 1.5 million 8% shareholder note due 2018 | |||
Debt, long-term and short-term, combined amount | |||
Face amount of debt | $ 1,500,000 | $ 1,500,000 | |
Interest rate (as a percent) | 8.00% | 8.00% | |
Total debt | $ 0 | $ 1,623,000 | |
Convertible Debt | 3.0 million 8% shareholder note due 2018 | |||
Debt, long-term and short-term, combined amount | |||
Face amount of debt | $ 3,000,000 | $ 3,000,000 | |
Interest rate (as a percent) | 8.00% | 8.00% | |
Total debt | $ 0 | $ 2,964,000 | |
Convertible Subordinated Debt | 3.0 million 8% subordinated convertible shareholder notes due 2018 | |||
Debt, long-term and short-term, combined amount | |||
Face amount of debt | $ 3,000,000 | $ 3,000,000 | |
Interest rate (as a percent) | 8.00% | 8.00% | |
Total debt | $ 0 | $ 2,972,000 |
Debt - Line of Credit with FGI
Debt - Line of Credit with FGI (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Feb. 14, 2011 | |
Line of Credit Facility [Line Items] | |||
Total debt | $ 3,261 | $ 11,072 | |
Line of Credit with FGI | Line of Credit | |||
Line of Credit Facility [Line Items] | |||
Maximum borrowing capacity | $ 7,500 | $ 7,500 | |
Threshold percentage of purchase receivables elected by issuer | 80.00% | ||
Purchased receivable reserved by borrower (as a percent) | 20.00% | ||
Advance amount of purchased accounts receivable (as a percent) | 80.00% | ||
Maximum borrowing capacity against inventory collateral | $ 1,500 | ||
Inventory collateral sublimit determinant percentage of aggregate purchase price for purchased receivable | 50.00% | ||
Maximum borrowing capacity against significant OEM customer inventory | $ 200 | ||
Line of credit facility interest rate determinant threshold percentage | 6.50% | ||
Interest rate on advances or borrowings | 6.50% | 6.50% | |
Periodic collateral fees percentage of eligible receivables | 0.30% | ||
Periodic collateral fees percentage of borrowing against inventory collateral | 0.38% | ||
Amount outstanding standby fees determination threshold | $ 2,400 | ||
Standby fees percentage of determinant rate | 0.44% | ||
Standby fees determinant rate | 80.00% | ||
Gross accounts receivable pledged as collateral | $ 600 | ||
Total debt | $ 1,458 | $ 3,513 | |
Line of Credit with FGI | Prime Rate | Line of Credit | |||
Line of Credit Facility [Line Items] | |||
Basis spread on variable rate | 2.50% | ||
Line of Credit with FGI | Secured Debt | Line of Credit | |||
Line of Credit Facility [Line Items] | |||
Total debt | $ 800 |
Debt - Kanis S.A. Indebtedness
Debt - Kanis S.A. Indebtedness (Details) - USD ($) | Aug. 30, 2016 | Aug. 25, 2016 | Jan. 31, 2017 | Jun. 30, 2016 | Jun. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Apr. 01, 2016 |
Debt Instrument [Line Items] | ||||||||
Loss on extinguishment of convertible debt | $ (12,410,000) | $ 0 | ||||||
Kanis Agreement | ||||||||
Debt Instrument [Line Items] | ||||||||
Liquidity event discount rate | 25.00% | |||||||
Bell Exchange Agreement | ||||||||
Debt Instrument [Line Items] | ||||||||
Issuance of common stock on conversion of debt (in shares) | 317,950 | |||||||
Extinguishment of debt, amount | $ 500,000 | |||||||
Convertible Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Extinguishment of debt, amount | $ 8,900,000 | |||||||
Convertible Debt | Kanis Agreement | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal amount outstanding | 7,500,000 | $ 7,500,000 | $ 7,500,000 | |||||
Liquidity event discount rate | 25.00% | 25.00% | ||||||
Conversion price (in dollars per share) | $ 1.6215 | $ 1.6215 | $ 3.60 | $ 3.60 | ||||
Loss on extinguishment of convertible debt | $ 10,200,000 | $ 1,600,000 | $ 1,600,000 | |||||
Issuance of common stock on conversion of debt (in shares) | 4,872,032 | |||||||
Extinguishment of debt, amount | $ 7,900,000 | |||||||
Accrued interest and embedded derivative liability | 400,000 | |||||||
Convertible Debt | 2.0 million 8% shareholder note due 2017 | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount of debt | $ 2,000,000 | $ 2,000,000 | $ 2,000,000 | |||||
Interest rate (as a percent) | 8.00% | 8.00% | 8.00% | |||||
Convertible Debt | Bell Exchange Agreement | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal amount outstanding | $ 500,000 | |||||||
Loss on extinguishment of convertible debt | $ 600,000 | |||||||
Issuance of common stock on conversion of debt (in shares) | 317,950 | |||||||
Extinguishment of debt, amount | $ 500,000 | |||||||
Subsequent Event | Convertible Debt | 2.0 million 8% shareholder note due 2017 | ||||||||
Debt Instrument [Line Items] | ||||||||
Repayment of shareholder note | $ 2,000,000 |
Debt - Director Note (Details)
Debt - Director Note (Details) - USD ($) | Aug. 30, 2016 | Aug. 25, 2016 | May 12, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Jun. 30, 2016 | Apr. 11, 2016 |
Debt Instrument [Line Items] | |||||||
Loss on extinguishment of convertible debt | $ (12,410,000) | $ 0 | |||||
Bell Exchange Agreement | |||||||
Debt Instrument [Line Items] | |||||||
Issuance of common stock on conversion of debt (in shares) | 317,950 | ||||||
Extinguishment of debt, amount | $ 500,000 | ||||||
Convertible Debt | |||||||
Debt Instrument [Line Items] | |||||||
Extinguishment of debt, amount | $ 8,900,000 | ||||||
Convertible Debt | 500,000 8% Director Note Due 2017 | |||||||
Debt Instrument [Line Items] | |||||||
Face amount of debt | $ 500,000 | ||||||
Interest rate (as a percent) | 8.00% | ||||||
Liquidity event discount rate | 25.00% | ||||||
Convertible Debt | Bell Director Note | |||||||
Debt Instrument [Line Items] | |||||||
Conversion price (in dollars per share) | $ 1.6215 | ||||||
Debt instrument, convertible, threshold consecutive trading days | 5 days | ||||||
Convertible Debt | Bell Exchange Agreement | |||||||
Debt Instrument [Line Items] | |||||||
Issuance of common stock on conversion of debt (in shares) | 317,950 | ||||||
Extinguishment of debt, amount | $ 500,000 | ||||||
Loss on extinguishment of convertible debt | $ 600,000 | ||||||
Common Stock | Convertible Debt | Bell Director Note | |||||||
Debt Instrument [Line Items] | |||||||
Conversion price (in dollars per share) | $ 3.55 |
Debt - Note Purchase Agreement
Debt - Note Purchase Agreement and Convertible Notes (Details) | Dec. 16, 2016USD ($)shares | Aug. 31, 2016USD ($)shares | Aug. 30, 2016shares | Aug. 25, 2016USD ($)shares | Jun. 30, 2016USD ($)sharesdirector$ / shares | Jun. 30, 2016USD ($)director$ / shares |
Note Purchase Agreement With Haldor Topsøe | ||||||
Debt Instrument [Line Items] | ||||||
Issuance of common stock on conversion of debt (in shares) | shares | 462,535 | 308,357 | ||||
Debt conversion, shares issued | shares | 462,535 | |||||
Extinguishment of debt, amount | $ 750,000 | $ 500,000 | ||||
Convertible Debt | Note Purchase Agreement With Haldor Topsøe | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate (as a percent) | 8.00% | 8.00% | ||||
Conversion price (in dollars per share) | $ / shares | $ 1.6215 | $ 1.6215 | ||||
Number of board of directors, increase | director | 1 | 1 | ||||
Number of board of directors, designated | director | 1 | 1 | ||||
Debt instrument convertible percentage of principal amount to be converted | 100.00% | |||||
Minimum percentage of counterparty ownership | 80.00% | |||||
Issuance of common stock on conversion of debt (in shares) | shares | 308,357 | |||||
Convertible Debt | Note Purchase Agreement With Haldor Topsøe | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, convertible, number of equity instruments | shares | 779,350 | |||||
Convertible Debt | Senior Convertible Promissory Note | ||||||
Debt Instrument [Line Items] | ||||||
Convertible notes payable | $ 750,000 | $ 750,000 | ||||
Qualified financing minimum aggregate gross proceeds | 5,000,000 | |||||
Convertible Debt | Convertible Promissory Note | ||||||
Debt Instrument [Line Items] | ||||||
Convertible notes payable | 500,000 | 500,000 | ||||
Convertible Debt | ||||||
Debt Instrument [Line Items] | ||||||
Debt conversion, shares issued | shares | 5,500,000 | |||||
Extinguishment of debt, amount | $ 8,900,000 | |||||
Convertible Debt | Senior Convertible Promissory Note | ||||||
Debt Instrument [Line Items] | ||||||
Convertible notes payable | 750,000 | 750,000 | ||||
Extinguishment of debt, amount | $ 750,000 | |||||
Convertible Debt | Convertible Promissory Note | ||||||
Debt Instrument [Line Items] | ||||||
Convertible notes payable | $ 500,000 | $ 500,000 |
Debt - Subordination Agreement
Debt - Subordination Agreement (Details) $ in Thousands | Dec. 31, 2016USD ($) |
Debt Instrument [Line Items] | |
2,017 | $ 3,458 |
2,018 | 0 |
Total | $ 3,458 |
Stockholders' Equity - Narrativ
Stockholders' Equity - Narrative (Details) $ / shares in Units, $ in Thousands | Dec. 16, 2016USD ($)$ / sharesshares | Aug. 31, 2016USD ($)shares | Aug. 30, 2016USD ($)shares | Jul. 22, 2016 | Dec. 31, 2016shares | Dec. 15, 2016shares | Jul. 21, 2016shares | May 25, 2016shares | Feb. 12, 2016shares | Feb. 11, 2016shares | Dec. 31, 2015shares |
Class of Stock [Line Items] | |||||||||||
Common stock and preferred stock, shares authorized (in shares) | 50,100,000 | 20,000,000 | 20,000,000 | 100,000,000 | 100,000,000 | 24,000,000 | |||||
Common stock, shares authorized (in shares) | 50,000,000 | 50,100,000 | 99,900,000 | 24,000,000 | |||||||
Preferred stock, shares authorized (in shares) | 100,000 | 100,000 | 100,000 | 100,000 | |||||||
Kanis Exchange Agreement | |||||||||||
Class of Stock [Line Items] | |||||||||||
Issuance of common stock on conversion of debt (in shares) | 4,872,032 | ||||||||||
Extinguishment of debt, amount | $ | $ 7,900 | ||||||||||
Bell Exchange Agreement | |||||||||||
Class of Stock [Line Items] | |||||||||||
Issuance of common stock on conversion of debt (in shares) | 317,950 | ||||||||||
Extinguishment of debt, amount | $ | $ 500 | ||||||||||
Note Purchase Agreement With Haldor Topsøe | |||||||||||
Class of Stock [Line Items] | |||||||||||
Issuance of common stock on conversion of debt (in shares) | 462,535 | 308,357 | |||||||||
Extinguishment of debt, amount | $ | $ 750 | $ 500 | |||||||||
Common Stock | |||||||||||
Class of Stock [Line Items] | |||||||||||
Reverse stock split ratio | 0.2 | ||||||||||
Issuance of common stock on conversion of debt (in shares) | 5,961,000 | ||||||||||
Common Stock | Securities Purchase Agreement with MDB Capital Group, LLC | |||||||||||
Class of Stock [Line Items] | |||||||||||
Share price (in dollars per share) | $ / shares | $ 2 | ||||||||||
Issuance of stock for settlement of accounts payable (in shares) | 81,550 | ||||||||||
Issuance of stock for settlement of accounts payable | $ | $ 200 |
Stockholders' Equity - Equity O
Stockholders' Equity - Equity Offerings (Details) - USD ($) $ / shares in Units, $ in Thousands | Dec. 16, 2016 | Nov. 04, 2016 | Nov. 23, 2015 | Jun. 02, 2015 | Dec. 16, 2016 | Dec. 31, 2016 | Dec. 31, 2015 |
Subsidiary, Sale of Stock [Line Items] | |||||||
Proceeds from equity offerings, net of costs | $ 10,200 | $ 7,115 | |||||
June 2015 Offering | |||||||
Subsidiary, Sale of Stock [Line Items] | |||||||
Units offered for sale | 500,000 | ||||||
Unit price (in dollars per share) | $ 10.25 | ||||||
Number of shares of stock into which each warrant may be converted (in shares) | 1 | ||||||
Share component per unit sold (in shares) | 1 | ||||||
Net proceeds allocated to equity | $ 3,700 | ||||||
November 2015 Offering | |||||||
Subsidiary, Sale of Stock [Line Items] | |||||||
Shares issued | 176,772 | ||||||
Share price (in dollars per share) | $ 6.10 | ||||||
Gross proceeds allocated to equity | $ 100 | ||||||
November 2016 Offering | |||||||
Subsidiary, Sale of Stock [Line Items] | |||||||
Net proceeds allocated to warrant liability | $ 900 | ||||||
Warrants Issued June 2015, Liability | |||||||
Subsidiary, Sale of Stock [Line Items] | |||||||
Exercise period | 5 years 6 months | ||||||
Warrants Issued June 2015, Liability | June 2015 Offering | |||||||
Subsidiary, Sale of Stock [Line Items] | |||||||
Warrant component per unit sold (in shares) | 0.2 | ||||||
Exercise price (in dollars per share) | $ 13.25 | ||||||
Expiration period | 6 months | ||||||
Proceeds from issuance of common stock and warrants | $ 5,100 | ||||||
Proceeds from equity offerings, net of costs | $ 4,500 | ||||||
Net proceeds allocated to warrant liability | 800 | ||||||
Additional underwriting discounts and commissions and offering costs allocated to warrants | $ 100 | ||||||
Series B Warrants | November 2015 Offering | |||||||
Subsidiary, Sale of Stock [Line Items] | |||||||
Number of shares of stock into which each warrant may be converted (in shares) | 1 | ||||||
Exercise price (in dollars per share) | $ 0.05 | ||||||
Number of shares into which warrants may be converted (in shares) | 337,228 | ||||||
Warrant price (in dollars per share) | $ 6.05 | ||||||
Exercise period | 2 years | ||||||
Series A Warrants | November 2015 Offering | |||||||
Subsidiary, Sale of Stock [Line Items] | |||||||
Exercise price (in dollars per share) | $ 8.50 | ||||||
Expiration period | 7 years | ||||||
Number of shares into which warrants may be converted (in shares) | 154,200 | ||||||
Exercise period | 5 years | ||||||
Warrant issued for purchase of one common stock purchased through pre-funded warrants | 0.3 | ||||||
Warrants Issued November 2015, Liability | November 2015 Offering | |||||||
Subsidiary, Sale of Stock [Line Items] | |||||||
Number of shares of stock into which each warrant may be converted (in shares) | 1 | ||||||
Proceeds from equity offerings, net of costs | $ 2,600 | ||||||
Additional underwriting discounts and commissions and offering costs allocated to warrants | $ 400 | ||||||
Number of shares into which surrendered and cancelled warrants could have been converted | 171,279 | ||||||
Exercise price of warrants surrendered and cancelled (in dollars per share) | $ 15.95 | ||||||
Gross proceeds from equity offerings | $ 3,100 | ||||||
Gross proceeds allocated to warrant liability | 3,400 | ||||||
Offering costs allocated to warrants issued | $ 400 | ||||||
Series C-1, Series C-2 and Series C-3 Warrants | November 2015 Offering | |||||||
Subsidiary, Sale of Stock [Line Items] | |||||||
Exercise price (in dollars per share) | $ 8.50 | ||||||
Expiration period | 7 years | ||||||
Number of shares into which warrants may be converted (in shares) | 171,279 | ||||||
Expiration period | 7 months | ||||||
Common Stock | |||||||
Subsidiary, Sale of Stock [Line Items] | |||||||
Shares issued | 5,662,000 | 677,000 | |||||
Issuance of stock for settlement of accounts payable (in shares) | 81,000 | ||||||
Common Stock | November 2016 Offering | |||||||
Subsidiary, Sale of Stock [Line Items] | |||||||
Number of shares of stock into which each warrant may be converted (in shares) | 489,475 | 489,475 | |||||
Exercise price (in dollars per share) | $ 2.20 | $ 2.20 | |||||
Proceeds from equity offerings, net of costs | $ 10,200 | ||||||
Net proceeds allocated to equity | $ 9,300 | ||||||
Additional underwriting discounts and commissions and offering costs allocated to warrants | $ 100 | ||||||
Shares issued | 4,222,290 | 949,960 | 5,172,250 | ||||
Share price (in dollars per share) | $ 2 | $ 2 | |||||
Gross proceeds from equity offerings | $ 8,400 | $ 1,900 | $ 10,300 | ||||
Issuance of stock for settlement of accounts payable (in shares) | 489,475 |
Warrants - Activity (Details)
Warrants - Activity (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Shares | ||
Outstanding at beginning of period (in shares) | 913,434 | 322,011 |
Issued (in shares) | 489,475 | 591,423 |
Exchange warrants issued (in shares) | 171,276 | |
Exchange warrants surrendered (in shares) | (171,276) | |
Exercised (in shares) | (410,824) | |
Expired (in shares) | (12,216) | |
Outstanding at end of period (in shares) | 979,869 | 913,434 |
Exercisable at end of period (in shares) | 979,869 | |
Weighted Average Exercise Price | ||
Outstanding at beginning of period (in dollars per share) | $ 3.54 | $ 17.71 |
Issued (in dollars per share) | 2.20 | 4.50 |
Exchange warrants (in dollars per share) | 8.50 | |
Exchange warrants surrendered (in dollars per share) | 15.95 | |
Exercised (in shares) | 1.73 | |
Expired ( in dollars per share) | 22.50 | |
Outstanding at end of period (in dollars per share) | 6.36 | 3.54 |
Exercisable at end of period (in dollars per share) | 6.36 | |
Range of Exercise Prices | ||
Issued (in dollars per share) | 2.50 | |
Exchange warrants issued (in dollars per share) | 8.50 | |
Expired (in dollars per share) | $ 22.50 | |
Equity classified as warrants | 21,920 | |
Minimum | ||
Range of Exercise Prices | ||
Outstanding at beginning of period (in dollars per share) | $ 6.25 | 6.25 |
Issued (in dollars per share) | 0.05 | |
Exchange warrants surrendered (in dollars per share) | 13.25 | |
Exercised (in dollars per share) | 0.05 | |
Outstanding at end of period (in dollars per share) | 0.05 | 6.25 |
Exercisable (in dollars per share) | 6.25 | |
Maximum | ||
Range of Exercise Prices | ||
Outstanding at beginning of period (in dollars per share) | 52 | 52 |
Issued (in dollars per share) | 6.25 | |
Exchange warrants surrendered (in dollars per share) | 21 | |
Exercised (in dollars per share) | 3 | |
Outstanding at end of period (in dollars per share) | 21 | $ 52 |
Exercisable (in dollars per share) | $ 21 |
Warrants - Assumptions (Details
Warrants - Assumptions (Details) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Fair value assumptions and methodology for assets and liabilities | ||
Dividend yield | 0.00% | 0.00% |
Black Scholes | ||
Fair value assumptions and methodology for assets and liabilities | ||
Dividend yield | 0.00% | |
Monte Carlo Simulation Model | ||
Fair value assumptions and methodology for assets and liabilities | ||
Dividend yield | 0.00% | |
Minimum | Black Scholes | ||
Fair value assumptions and methodology for assets and liabilities | ||
Expected volatility | 97.70% | |
Risk-free interest rate | 1.40% | |
Expected life in years | 2 years 9 months 18 days | |
Minimum | Monte Carlo Simulation Model | ||
Fair value assumptions and methodology for assets and liabilities | ||
Expected volatility | 97.70% | |
Risk-free interest rate | 1.03% | |
Expected life in years | 1 year 6 months | |
Maximum | Black Scholes | ||
Fair value assumptions and methodology for assets and liabilities | ||
Expected volatility | 106.40% | |
Risk-free interest rate | 1.92% | |
Expected life in years | 5 years | |
Maximum | Monte Carlo Simulation Model | ||
Fair value assumptions and methodology for assets and liabilities | ||
Expected volatility | 106.40% | |
Risk-free interest rate | 1.43% | |
Expected life in years | 2 years 10 months 24 days |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured at Fair Value (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Warrant liability | $ 1,226 | $ 3,072 |
Liability transfers from Level 1 to Level 2 | 0 | |
Liability transfers from Level 2 to Level 1 | 0 | |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Warrant liability | 0 | 0 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Warrant liability | 0 | 0 |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Warrant liability | $ 1,226 | $ 3,072 |
Fair Value Measurements - Recon
Fair Value Measurements - Reconciliation of Warrant Liability Included in Expenses and Other Current Liabilities (Details) - Warrant - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Reconciliation of warrant liability and embedded derivative | ||
Balance at beginning of period | $ 3,072 | $ 1,474 |
Issuance of common stock warrants | 858 | 4,215 |
Exercise of common stock warrants | (1,150) | 0 |
Gain on change in fair value | (1,554) | (2,617) |
Balance at end of period | $ 1,226 | $ 3,072 |
Fair Value Measurements - Rec75
Fair Value Measurements - Reconciliation of Embedded Derivative Measured at Fair Value (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Apr. 01, 2016 | |
Embedded Derivative Financial Instruments | |||
Reconciliation of warrant liability and embedded derivative | |||
Balance at beginning of period | $ 0 | $ 0 | |
Transfers in and/or out of Level 3 | 0 | 0 | |
Initial valuation of bifurcated derivative liability | 3,936 | 0 | |
Extinguishment of bifurcated derivative liability | (3,936) | 0 | |
Balance at end of period | $ 0 | $ 0 | |
Kanis Agreement | |||
Reconciliation of warrant liability and embedded derivative | |||
Liquidity event discount rate | 25.00% |
Fair Value Measurements - Assum
Fair Value Measurements - Assumptions (Details) - Embedded Derivative Financial Instruments | Apr. 01, 2016 |
Fair Value Measurements, Recurring and Nonrecurring, Valuation Techniques [Line Items] | |
Expected volatility | 109.00% |
Risk-free interest rate | 0.80% |
Expected life in years | 2 years 6 months |
Fair Value Measurements - Debt
Fair Value Measurements - Debt (Details) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of shareholder notes payable | $ 1.8 | $ 7.6 |
Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Fair value of shareholder notes payable | $ 1.8 |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock Incentive Plan (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 16, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares reserved for issuance | 1,400,000 | ||
Shares available for future grant | 81,766 | ||
Stock-based compensation expense | $ 1.6 | $ 0.8 | |
Omnibus Plan 2016 | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares reserved for issuance | 2,250,000 |
Stock-Based Compensation - St79
Stock-Based Compensation - Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Options | ||
Outstanding at beginning of period | 256,963 | |
Granted | 875,000 | |
Cancelled | (24,500) | |
Vested shares expired | (34,175) | |
Outstanding at end of period | 1,073,288 | 256,963 |
Exercisable at end of period | 471,374 | |
Weighted Average Exercise Price | ||
Outstanding at beginning of period | $ 20.01 | |
Granted | 2.24 | |
Cancelled | 8.47 | |
Vested shares expired | 36.68 | |
Outstanding at end of period | 5.26 | $ 20.01 |
Exercisable at end of period | $ 8.82 | |
Weighted Average Remaining Contractual Term | ||
Weighted average remaining contractual term (in years) | 9 years 4 months 24 days | 7 years 8 months |
Exercisable at end of period | 8 years 10 months | |
Outstanding aggregate intrinsic value (in thousands) | $ 5,500 | |
Exercisable aggregate intrinsic value (in thousands) | $ 2,750 |
Stock-Based Compensation - Weig
Stock-Based Compensation - Weighted Average Assumptions and Grant Date Fair Value (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Weighted-average assumptions and grant date fair value | ||
Expected volatility (as a percent), minimum | 153.70% | |
Expected volatility (as a percent), maximum | 168.50% | |
Expected volatility (as a percent) | 126.00% | |
Risk free interest rate (as a percent), minimum | 1.19% | |
Risk free interest rate (as a percent), maximum | 2.18% | |
Risk-free interest rate (as a percent) | 1.70% | |
Dividend yield | 0.00% | 0.00% |
Expected life in years | 6 years | 5 years 4 months 24 days |
Weighted average grant date fair value | $ 2.12 | $ 7.60 |
Stock-Based Compensation - Expi
Stock-Based Compensation - Expiration Period (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized compensation expense, options | $ 1.3 |
Recognition period | 3 years 8 months 26 days |
Employee Stock Option | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expiration period | 10 years |
Stock-Based Compensation - RSU
Stock-Based Compensation - RSU Activity (Details) | 12 Months Ended |
Dec. 31, 2016$ / sharesshares | |
Weighted Average Grant Date Fair Value | |
Nonvested at beginning of period | $ 7.60 |
Nonvested units at end of period | $ 2.12 |
Restricted Stock Units (RSUs) | |
Shares | |
Nonvested at beginning of period | shares | 39,405 |
Granted | shares | 5,789 |
Vested | shares | (28,806) |
Forfeited | shares | (3,999) |
Nonvested units at end of period | shares | 12,389 |
Weighted Average Grant Date Fair Value | |
Nonvested at beginning of period | $ 12.55 |
Granted | 2.64 |
Vested | 11.38 |
Forfeited | 13.05 |
Nonvested units at end of period | $ 10.50 |
Stock-Based Compensation - RS83
Stock-Based Compensation - RSU Unrecognized Expense (Details) | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Restricted Stock Units | |
Recognition period | 3 years 8 months 26 days |
Restricted Stock Units (RSUs) | |
Restricted Stock Units | |
Unrecognized compensation expense, RSUs | $ 37,500 |
Recognition period | 10 months 24 days |
Impairment - (Details)
Impairment - (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | |
Goodwill [Line Items] | |||
Goodwill impairment | $ 4,700 | $ 4,675 | $ 0 |
Goodwill | $ 0 | $ 0 | $ 4,659 |
Goodwill | |||
Goodwill [Line Items] | |||
Discount rate | 15.00% | ||
Terminal growth rate | 3.00% |
Income Taxes - Income (loss) Fr
Income Taxes - Income (loss) From Continuing Operations Before Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | ||
U.S.-based operations | $ (17,344) | $ (7,770) |
Non U.S.-based operations | (7,088) | (1,051) |
Loss from continuing operations before income tax benefit | $ (24,432) | $ (8,821) |
Income Taxes - Income Tax Expen
Income Taxes - Income Tax Expense (Benefit) Attributable to Loss From Continuing Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Current | ||
Current federal income tax expense (benefit) | $ 0 | |
Current state and local income tax expense (benefit) | $ 22 | 4 |
Current foreign income tax expense (benefit) | (210) | (269) |
Total current income tax expense (benefit) | (188) | (265) |
Deferred | ||
Deferred foreign income tax expense (benefit) | (770) | (134) |
Total deferred income tax expense (benefit) | (770) | (134) |
Total | ||
Total federal income tax expense (benefit) | 0 | |
Total state and local income tax expense (benefit) | 22 | 4 |
Total foreign income tax expense (benefit) | (980) | (403) |
Total income tax expense (benefit) | $ (958) | $ (399) |
Income Taxes - Components of In
Income Taxes - Components of Income Tax Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Effective income tax rate reconciliation, percent | ||
U.S. federal statutory rate | 34.00% | 34.00% |
Effective income tax rate reconciliation, amount | ||
Expected tax benefit | $ (8,307) | $ (2,999) |
Net tax effects of: | ||
Foreign tax rate differential | 1,331 | 167 |
State taxes, net of federal benefit | 219 | (602) |
Return to provision adjustment | 13,386 | (619) |
Research and other credits | 443 | (59) |
Permanent difference on convertible notes and warrants | 2,923 | (589) |
Goodwill impairment | 533 | 0 |
Other | 61 | 52 |
Change in deferred tax asset valuation allowance | (11,547) | 4,250 |
Total income tax expense (benefit) | $ (958) | $ (399) |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred tax assets: | ||
Research and development credits | $ 2,063 | $ 2,763 |
Other credits | 0 | 487 |
Operating loss carry forwards | 7,320 | 17,249 |
Interest | 460 | 0 |
Inventories | 289 | 254 |
Allowance for doubtful accounts | 129 | 116 |
Depreciation | 353 | 382 |
Deferred research and development expenses for income tax | 0 | 240 |
Non-cash compensation | 946 | 1,120 |
Other | 929 | 921 |
Total gross deferred tax assets | 12,489 | 23,532 |
Valuation allowance | (11,441) | (23,091) |
Net deferred tax assets | 1,048 | 441 |
Deferred tax liabilities: | ||
Other identifiable intangible assets | (494) | (634) |
Total gross deferred tax liabilities | (494) | (634) |
Deferred tax assets, net | $ 554 | |
Deferred tax liabilities, net | $ (193) |
Income Taxes - Operating Loss C
Income Taxes - Operating Loss Carryforwards (Details) $ in Millions | Dec. 31, 2016USD ($) |
United States—Federal | |
Operating Loss Carryforwards [Line Items] | |
Operating Loss Carryforwards, Limitations on Use, Annual Limitation for Next Five Years | $ 1.1 |
Operating Loss Carryforwards, Limitations on Use, Annual Limitation for Next Fifteen Years | 0.3 |
Operating loss carryforwards | 14.7 |
United States—State | |
Operating Loss Carryforwards [Line Items] | |
Operating loss carryforwards | $ 14.8 |
Income Taxes - Tax Credit Carry
Income Taxes - Tax Credit Carryforward (Details) $ in Millions | Dec. 31, 2016USD ($) |
United States—Federal | |
Tax Credit Carryforward [Line Items] | |
Operating loss carryforward subject to annual limitation | $ 11.9 |
United States—State | |
Tax Credit Carryforward [Line Items] | |
Operating loss carryforward subject to annual limitation | 10.4 |
Research Tax Credit Carryforward | United States—State | |
Tax Credit Carryforward [Line Items] | |
Carryforward credits | $ 3.9 |
Reserve on credit | 20.00% |
Income Taxes - Changes Occured
Income Taxes - Changes Occured in the Amount of Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Reconciliation of unrecognized tax benefits including related interest and penalties | ||
Balance at beginning of year | $ 634 | $ 683 |
Additions for current year tax provisions | 49 | 32 |
Additions/Reduction for tax positions of prior years | 786 | 0 |
Reduction for prior year tax provisions | 0 | (81) |
Balance at end of year | $ 1,469 | $ 634 |
Income Taxes - Unrecognized Tax
Income Taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Income Tax Disclosure [Abstract] | ||
Accrued interest and penalties payment for unrecognized tax benefits | $ 0.2 | $ 0.1 |
Income Taxes - Multiple Tax Jur
Income Taxes - Multiple Tax Jurisdictions, both Within and Outside of the United States (Details) | 12 Months Ended |
Dec. 31, 2016 | |
United States—Federal | Internal Revenue Service (IRS) | Minimum | |
Income Tax Examination [Line Items] | |
Open tax year | 2,013 |
United States—Federal | Internal Revenue Service (IRS) | Maximum | |
Income Tax Examination [Line Items] | |
Open tax year | 2,016 |
United States—State | Minimum | |
Income Tax Examination [Line Items] | |
Open tax year | 2,012 |
United States—State | Maximum | |
Income Tax Examination [Line Items] | |
Open tax year | 2,016 |
Foreign Tax Authority | Canada Revenue Agency | Minimum | |
Income Tax Examination [Line Items] | |
Open tax year | 2,011 |
Foreign Tax Authority | Canada Revenue Agency | Maximum | |
Income Tax Examination [Line Items] | |
Open tax year | 2,016 |
Foreign Tax Authority | Swedish Tax Agency | Minimum | |
Income Tax Examination [Line Items] | |
Open tax year | 2,014 |
Foreign Tax Authority | Swedish Tax Agency | Maximum | |
Income Tax Examination [Line Items] | |
Open tax year | 2,016 |
Foreign Tax Authority | Her Majesty's Revenue and Customs (HMRC) | Minimum | |
Income Tax Examination [Line Items] | |
Open tax year | 2,012 |
Foreign Tax Authority | Her Majesty's Revenue and Customs (HMRC) | Maximum | |
Income Tax Examination [Line Items] | |
Open tax year | 2,016 |
Commitments and Contingencies94
Commitments and Contingencies - Future Minimum Lease Payments Under Non-cancelable Operating Leases (Details) $ in Thousands | Dec. 31, 2016USD ($) |
Future minimum lease payments under non-cancelable operating leases | |
2,017 | $ 501 |
2,018 | 462 |
2,019 | 2 |
2,020 | 1 |
2021 and thereafter | 0 |
Total minimum lease payments | $ 966 |
Commitments and Contingencies95
Commitments and Contingencies - Narrative (Details) - USD ($) $ in Millions | Jun. 26, 2015 | Mar. 30, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Loss Contingencies [Line Items] | ||||
Rent expense | $ 0.6 | $ 0.9 | ||
CARB | ||||
Loss Contingencies [Line Items] | ||||
Calculated penalty for alleged violations | $ 1.8 | 0.8 | ||
CARB | Maximum | ||||
Loss Contingencies [Line Items] | ||||
Amount accrued (less than $0.1 million) | $ 0.1 | |||
Subsequent Event | CARB | ||||
Loss Contingencies [Line Items] | ||||
Settlement, amount awarded to other party | $ 0.1 |
Geographic Information - Net Sa
Geographic Information - Net Sales by Geographic Region (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total revenues | $ 36,839 | $ 39,738 |
United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total revenues | 23,870 | 24,323 |
Total international | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total revenues | 12,969 | 15,415 |
Canada | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total revenues | 9,583 | 12,143 |
Europe | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Total revenues | $ 3,386 | $ 3,272 |
Geographic Information - Fixed
Geographic Information - Fixed Assets and Total Assets by Geographic Region (Details) - USD ($) $ in Thousands | Dec. 31, 2016 | Dec. 31, 2015 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property and Equipment, net | $ 1,158 | $ 1,538 |
Total Assets | 24,830 | 25,102 |
United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property and Equipment, net | 1,082 | 1,247 |
Total Assets | 15,126 | 11,266 |
Total international | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property and Equipment, net | 76 | 291 |
Total Assets | 9,704 | 13,836 |
Canada | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property and Equipment, net | 71 | 290 |
Total Assets | 8,352 | 11,641 |
Europe | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Property and Equipment, net | 5 | 1 |
Total Assets | $ 1,352 | $ 2,195 |
Geographic Information - Narrat
Geographic Information - Narrative (Details) - segment | 3 Months Ended | |
Jun. 30, 2016 | Mar. 31, 2016 | |
Segment Reporting [Abstract] | ||
Number of reportable segments | 1 | 2 |
Concentrations - Concentration
Concentrations - Concentration Risk Percentage (Details) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Concentration Risk [Line Items] | ||
Concentration Risk, Supplier | 1 | 2 |
One Original Equipment Manufacturer Customer | Sales Revenue, Net | Customer Concentration Risk | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 59.00% | 57.00% |
One Original Equipment Manufacturer Customer | Accounts Receivable | Credit Concentration Risk | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 35.00% | 31.00% |
One Original Equipment Manufacturer Customer | Material Purchases [Member] | Customer Concentration Risk | ||
Concentration Risk [Line Items] | ||
Concentration risk percentage | 30.00% | 58.00% |
Supplementary Cash Flow Info100
Supplementary Cash Flow Information - (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Supplemental Cash Flow Elements [Abstract] | ||
Cash paid for interest | $ 694 | $ 1,075 |
Cash paid for income taxes | 43 | 227 |
Class of Stock [Line Items] | ||
Issuance of common stock to placement agent in connection with equity offering (Note 11) | 5 | 0 |
Issuance of warrants to placement agent in connection with equity offering (Note 11) | 857 | 0 |
Accounts Payable settled with common stock | 184 | 0 |
Kanis Agreement | ||
Class of Stock [Line Items] | ||
Notes payable settled with common stock (Note 10) | 7,900 | 0 |
Note Purchase Agreement With Haldor Topsøe | ||
Class of Stock [Line Items] | ||
Notes payable settled with common stock (Note 10) | 1,250 | 0 |
Bell Director Note | ||
Class of Stock [Line Items] | ||
Notes payable settled with common stock (Note 10) | $ 515 | $ 0 |
Discontinued Operations - Appli
Discontinued Operations - Applied Utility Systems, Inc. (Details) - Applied Utility Systems, Inc. - USD ($) $ in Millions | Jun. 03, 2015 | Oct. 01, 2009 | Oct. 31, 2015 | Dec. 31, 2016 | Jul. 21, 2014 | Dec. 31, 2013 |
Sales And Use Tax Audit | ||||||
Discontinued Operations [Line Items] | ||||||
Loss contingency estimate of possible loss | $ 1.5 | |||||
Basis for determining sales tax owed | $ 12.2 | |||||
Adjusted basis for determining sales tax owed | $ 9 | |||||
Amount offered to settle the case | $ 0.1 | |||||
Discontinued Operations, Held-for-sale | ||||||
Discontinued Operations [Line Items] | ||||||
Settlement sought | $ 0.9 | |||||
Settlement amount | $ 0.7 | |||||
Settlement paid | $ 0.1 | |||||
Maximum | Sales And Use Tax Audit | ||||||
Discontinued Operations [Line Items] | ||||||
Loss contingency estimate of possible loss | $ 0.9 |
Discontinued Operations - Reven
Discontinued Operations - Revenue and Expense Information (Details) - Discontinued Operations, Held-for-sale - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Revenue and expense information for discontinued operations | ||
Revenue | $ 0 | $ 0 |
Expenses | 0 | (112) |
Net loss from discontinued operations | $ 0 | $ (112) |