Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | Apr. 30, 2020 | |
Office Sublease [Member] | ||
Entity Registrant Name | Stereotaxis, Inc. | |
Entity Central Index Key | 0001289340 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2020 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business Flag | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 69,042,016 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2020 |
Balance Sheets
Balance Sheets - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 28,024,723 | $ 30,182,115 |
Accounts receivable, net of allowance of $401,692 and $380,212 at 2020 and 2019, respectively | 4,615,078 | 5,329,577 |
Inventories, net | 3,170,140 | 1,847,530 |
Prepaid expenses and other current assets | 1,390,503 | 1,470,922 |
Total current assets | 37,200,444 | 38,830,144 |
Property and equipment, net | 220,324 | 250,443 |
Operating lease right-of-use assets | 3,790,044 | 4,286,064 |
Long-term receivables | 95,483 | |
Other assets | 196,674 | 218,103 |
Total assets | 41,502,969 | 43,584,754 |
Current liabilities: | ||
Accounts payable | 2,002,297 | 2,099,097 |
Accrued liabilities | 2,342,197 | 2,721,104 |
Deferred revenue | 5,266,715 | 5,092,455 |
Current portion of operating lease liabilities | 2,255,875 | 2,248,189 |
Total current liabilities | 11,867,084 | 12,160,845 |
Long-term deferred revenue | 510,689 | 554,258 |
Operating lease liabilities | 1,585,928 | 2,089,537 |
Other liabilities | 255,517 | 255,517 |
Total liabilities | 14,219,218 | 15,060,157 |
Series A - Convertible preferred stock: | ||
Convertible preferred stock, Series A, par value $0.001; 22,918 and 23,110 shares outstanding at 2020 and 2019, respectively | 5,709,027 | 5,758,190 |
Stockholders' equity: | ||
Convertible preferred stock, Series B, par value $0.001; 10,000,000 shares authorized, 5,610,121 shares outstanding at 2020 and 2019 | 5,610 | 5,610 |
Common stock, par value $0.001; 300,000,000 shares authorized, 69,040,781 and 68,529,623 shares issued at 2020 and 2019, respectively | 69,041 | 68,530 |
Additional paid in capital | 504,990,377 | 504,211,040 |
Treasury stock, 4,015 shares at 2020 and 2019 | (205,999) | (205,999) |
Accumulated deficit | (483,284,305) | (481,312,774) |
Total stockholders' equity | 21,574,724 | 22,766,407 |
Total liabilities and stockholders' equity | $ 41,502,969 | $ 43,584,754 |
Balance Sheets (Parenthetical)
Balance Sheets (Parenthetical) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance | $ 401,692 | $ 380,212 |
Series A Convertible Preferred Stock, par value | $ 0.001 | $ 0.001 |
Series A Convertible Preferred Stock, shares outstanding | 22,918 | 23,110 |
Series B Convertible Preferred Stock, par value | $ 0.001 | $ 0.001 |
Series B Convertible Preferred Stock, shares authorized | 10,000,000 | 10,000,000 |
Series B Convertible Preferred Stock, shares outstanding | 5,610,121 | 5,610,121 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common stock, shares issued | 69,040,781 | 68,529,623 |
Treasury stock, shares | 4,015 | 4,015 |
Statements of Operations (Unaud
Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Revenue: | ||
Sublease | $ 246,530 | $ 241,065 |
Total revenue | 5,756,241 | 7,009,875 |
Cost of revenue: | ||
Sublease | 246,530 | 246,530 |
Total cost of revenue | 951,415 | 1,412,053 |
Gross margin | 4,804,826 | 5,597,822 |
Operating expenses: | ||
Research and development | 2,109,170 | 2,959,219 |
Sales and marketing | 2,915,424 | 3,309,829 |
General and administrative | 1,832,726 | 1,468,160 |
Total operating expenses | 6,857,320 | 7,737,208 |
Operating loss | (2,052,494) | (2,139,386) |
Interest income | 80,963 | 16,566 |
Net loss | (1,971,531) | (2,122,820) |
Cumulative dividend on convertible preferred stock | (343,723) | (353,510) |
Loss attributable to common stockholders | $ (2,315,254) | $ (2,476,330) |
Net loss per share attributable to common stockholders: | ||
Basic | $ (0.03) | $ (0.04) |
Diluted | $ (0.03) | $ (0.04) |
Weighted average number of common shares and equivalents: | ||
Basic | 69,870,040 | 59,196,652 |
Diluted | 69,870,040 | 59,196,652 |
Systems [Member] | ||
Revenue: | ||
Total revenue | $ 58,051 | |
Cost of revenue: | ||
Total cost of revenue | 65,022 | 51,163 |
Disposables, Service and Accessories [Member] | ||
Revenue: | ||
Total revenue | 5,509,711 | 6,710,759 |
Cost of revenue: | ||
Total cost of revenue | $ 639,863 | $ 1,114,360 |
Statements of Convertible Prefe
Statements of Convertible Preferred Stock and Stockholders' Equity (Unaudited) - USD ($) | Convertible Preferred Stock Series A (Mezzanine) [Member] | Convertible Preferred Stock Series B [Member] | Common Stock [Member] | Additional Paid-In Capital [Member] | Treasury Stock [Member] | Accumulated Deficit [Member] | Total |
Beginning Balance at Dec. 31, 2018 | $ 5,960,475 | $ 59,058 | $ 478,179,574 | $ (205,999) | $ (476,721,490) | $ 1,311,143 | |
Beginning Balance, Shares at Dec. 31, 2018 | 23,900 | 59,058,297 | |||||
Issuance of common stock and warrants | $ 33 | 16,390 | 16,423 | ||||
Issuance of common stock and warrants, Shares | 33,087 | ||||||
Share-based compensation | $ 167 | 147,787 | 147,954 | ||||
Share-based compensation, shares | 166,962 | ||||||
Components of net loss | (2,122,820) | (2,122,820) | |||||
Employee stock purchase plan | $ 15 | 15,049 | 15,064 | ||||
Employee stock purchase plan, Shares | 14,625 | ||||||
Preferred stock conversion | $ (5,121) | $ 35 | 5,086 | 5,121 | |||
Preferred stock conversion, shares | (20) | 35,266 | |||||
Ending Balance at Mar. 31, 2019 | $ 5,955,354 | $ 59,308 | 478,363,886 | (205,999) | (478,844,310) | (627,115) | |
Ending Balance, Shares at Mar. 31, 2019 | 23,880 | 59,308,237 | |||||
Beginning Balance at Dec. 31, 2019 | $ 5,758,190 | $ 5,610 | $ 68,530 | 504,211,040 | (205,999) | (481,312,774) | 22,766,407 |
Beginning Balance, Shares at Dec. 31, 2019 | 23,110 | 5,610,121 | 68,529,623 | ||||
Issuance of common stock and warrants | $ 41 | (23,891) | (23,850) | ||||
Issuance of common stock and warrants, Shares | 40,816 | ||||||
Share-based compensation | $ 109 | 722,203 | 722,312 | ||||
Share-based compensation, shares | 109,489 | ||||||
Components of net loss | (1,971,531) | (1,971,531) | |||||
Employee stock purchase plan | $ 7 | 32,216 | 32,223 | ||||
Employee stock purchase plan, Shares | 6,406 | ||||||
Preferred stock conversion | $ (49,163) | $ 354 | 48,809 | 49,163 | |||
Preferred stock conversion, shares | (192) | 354,447 | |||||
Ending Balance at Mar. 31, 2020 | $ 5,709,027 | $ 5,610 | $ 69,041 | $ 504,990,377 | $ (205,999) | $ (483,284,305) | $ 21,574,724 |
Ending Balance, Shares at Mar. 31, 2020 | 22,918 | 5,610,121 | 69,040,781 |
Statements of Cash Flows (Unaud
Statements of Cash Flows (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash flows from operating activities | ||
Net loss | $ (1,971,531) | $ (2,122,820) |
Adjustments to reconcile net loss to cash used in operating activities: | ||
Depreciation | 30,119 | 24,912 |
Non-cash lease expense | 585,586 | 567,857 |
Share-based compensation | 722,312 | 147,923 |
Changes in operating assets and liabilities: | ||
Accounts receivable | 714,499 | (218,359) |
Inventories | (1,322,610) | (117,468) |
Prepaid expenses and other current assets | 80,419 | 189,686 |
Long term receivables | (95,483) | |
Other assets | 21,429 | 41,194 |
Accounts payable | (96,800) | 656,870 |
Accrued liabilities | (378,907) | (368,794) |
Deferred revenue | 130,691 | (182,265) |
Operating lease liability | (585,489) | (567,857) |
Other liabilities | 172,180 | |
Net cash used in operating activities | (2,165,765) | (1,776,941) |
Cash flows from investing activities | ||
Purchase of equipment | (9,833) | |
Net cash used in investing activities | (9,833) | |
Cash flows from financing activities | ||
Proceeds from issuance of stock, net of issuance costs | 8,373 | 31,518 |
Net cash provided by financing activities | 8,373 | 31,518 |
Net decrease in cash and cash equivalents | (2,157,392) | (1,755,256) |
Cash and cash equivalents at beginning of period | 30,182,115 | 10,796,072 |
Cash and cash equivalents at end of period | $ 28,024,723 | $ 9,040,816 |
Description of Business
Description of Business | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Description of Business | 1. Description of Business Stereotaxis designs, manufactures and markets an advanced robotic magnetic navigation system for use in a hospital’s interventional surgical suite, or “interventional lab”, that we believe revolutionizes the treatment of arrhythmias by enabling enhanced safety, efficiency, and efficacy for catheter-based, or interventional, procedures. Our primary products include the Genesis RMN Niobe Odyssey The Genesis RMN Niobe Niobe In addition to the robotic magnetic navigation systems and their components, Stereotaxis also has developed the Odyssey Odyssey Cinema Odyssey We promote our full suite of products in a typical hospital implementation, subject to regulatory approvals or clearances. This implementation requires a hospital to agree to an upfront capital payment and recurring payments. The upfront capital payment typically includes equipment and installation charges. The recurring payments typically include disposable costs for each procedure, equipment service costs beyond warranty period, and ongoing software updates. In hospitals where our full suite of products has not been implemented, equipment upgrade or expansion can be implemented upon purchasing of the necessary upgrade or expansion. We have received regulatory clearance, licensing and/or CE Mark approvals necessary for us to market the Genesis RMN Niobe Odyssey Cardiodrive Vdrive Vdrive Duo V-CAS V-Loop V-Sono V-CAS Deflect We have strategic relationships with technology leaders and innovators in the global interventional market. Through these strategic relationships we provide compatibility between our robotic magnetic navigation system and digital imaging and 3D catheter location sensing technology, as well as disposable interventional devices. The maintenance of these strategic relationships, or the establishment of equivalent alternatives, is critical to our commercialization efforts. There are no guarantees that any existing strategic relationships will continue and efforts are ongoing to ensure the availability of integrated next generation systems and/or equivalent alternatives. We cannot provide assurance as to the timeline of the ongoing availability of such compatible systems or our ability to obtain equivalent alternatives on competitive terms or at all. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Basis of Presentation The accompanying unaudited financial statements of Stereotaxis, Inc. have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and the instructions to Form 10-Q. Accordingly, they do not include all the disclosures required by GAAP for complete financial statements. In the opinion of management, they include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results for the interim periods presented. Operating results for the three month period ended March 31, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020 or for future operating periods. These interim financial statements and the related notes should be read in conjunction with the annual financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 as filed with the Securities and Exchange Commission (SEC) on March 16, 2020. Risks and Uncertainties The novel coronavirus COVID-19 (“COVID-19”) pandemic has resulted, and is likely to continue to result, in significant disruptions to the economy, as well as business and capital markets around the world. The full extent of the impact of the COVID-19 pandemic on our business, results of operations and financial condition will depend on numerous evolving factors that we may not be able to accurately predict. As a result of the COVID-19 outbreak, we have experienced business disruptions, including travel restrictions on us and our third-party distributors, which have negatively affected our complex sales, marketing, installation, distribution and service network relating to our products and services. The COVID-19 pandemic may continue to negatively affect demand for our both our systems and our disposable products by limiting the ability of our sales personnel to maintain their customary contacts with customers as governmental authorities institute prolonged quarantines, travel restrictions, and shelter-in-place orders, or as our customers impose limitations on contacts and in-person meetings that go beyond those imposed by governmental authorities. In addition, many of our hospital customers, for whom the purchase of our system involves a significant capital purchase which may be part of a larger construction project at the customer site (typically the construction of a new building), may themselves be under economic pressures. This may cause delays or cancellations of current purchase orders and other commitments, and may exacerbate the long and variable sales and installation cycles for our robotic systems products. We may also experience significant reductions in demand for our disposable products as our healthcare customers (physicians and hospitals) continue to re-prioritize the treatment of patients and divert resources away from non-coronavirus areas, which we anticipate will lead to the performance of fewer procedures in which our disposable products are used. In addition, patients may consider foregoing or deferring procedures utilizing our products, even if physicians and hospitals are willing to perform them, which could also reduce demand for, and sales of, our disposable products. As of the date of the filing of this Quarterly Report on Form 10-Q, we believe our manufacturing operations and supply chains have been minimally interrupted, but we cannot guarantee that they will not be interrupted more severely in the future. If our manufacturing operations or supply chains are materially interrupted, it may not be possible for us to timely manufacture relevant products at required levels, or at all. A material reduction or interruption to any of our manufacturing processes would have a material adverse effect on our business, operating results, and financial condition. As governmental authorities around the world continue to institute prolonged mandatory closures, social distancing protocols and shelter-in-place orders, or as private parties on whom we rely to operate our business put in place their own protocols that go beyond those instituted by relevant governmental authorities, our ability to adequately staff and maintain our operations or further our product development could be negatively impacted. Any continued disruption to the capital markets could negatively impact our ability to raise capital. If the capital markets continue to be disrupted for an extended period of time and we need to raise additional capital, such capital may not be available on acceptable terms, or at all. Continued disruptions to the capital markets and other financing sources could also negatively impact our hospital customers’ ability to raise capital or otherwise obtain financing to fund their operations and capital projects. Such could result in delayed spending on current projects, a longer sales cycle for new projects where a large capital commitment is required, and decreased demand for our disposable products as well as an increased risk of customer defaults or delays in payments for our systems installations, and for our service contracts and disposable products. We are evaluating and taking actions to reduce costs and spending across our organization. We will continue to actively monitor the situation and may take further actions that alter our business operations as may be required by federal, state or local governmental authorities that may be implemented by our vendors, supplier or customers, or that we determine are in the best interests of our employees, customers, suppliers and shareholders. Financial Instruments Financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable, and debt. The carrying value of such amounts reported at the applicable balance sheet dates approximates fair value. The Company measures certain financial assets and liabilities at fair value on a recurring basis. General accounting principles for fair value measurement established a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets and liabilities (“Level 1”) and the lowest priority to unobservable inputs (“Level 3”). As of March 31, 2020 and December 31, 2019 the Company did not have any financial assets or liabilities valued at fair value on a recurring basis. Revenue and Costs of Revenue The Company accounts for revenue in accordance with Accounting Standards Codification Topic 606 (“ASC 606”), Revenue from Contracts with Customers We generate revenue from initial capital sales of systems as well as recurring revenue from the sale of our proprietary disposable devices, from royalties paid to the Company on the sale by Biosense Webster of co-developed catheters, and from other recurring revenue including ongoing software updates and service contracts. We account for a contract with a customer when there is a legally enforceable contract between the Company and the customer, the rights of the parties are identified, the contract has commercial substance, and collectability of the contract consideration is probable. We record our revenue based on consideration specified in the contract with each customer, net of any taxes collected from customers that are remitted to government authorities. For contracts containing multiple products and services, the Company accounts for individual products and services as separate performance obligations if they are distinct, which is if a product or service is separately identifiable from other items in the bundled package, and if a customer can benefit from it on its own or with other resources that are readily available to the customer. The Company recognizes revenues as the performance obligations are satisfied by transferring control of the product or service to a customer. For arrangements with multiple performance obligations, revenue is allocated to each performance obligation based on its relative standalone selling price. Standalone selling prices are based on observable prices at which the Company separately sells the products or services. If a standalone selling price is not directly observable, then the Company estimates the standalone selling price considering market conditions and entity-specific factors including, but not limited to, features and functionality of the products and services and market conditions. The Company regularly reviews standalone selling prices and updates these estimates as necessary. Systems: Contracts related to the sale of systems typically contain separate obligations for the delivery of system(s), installation and an implied obligation to provide software enhancements if and when available for one year following installation. Revenue is recognized when the Company transfers control to the customer, which is generally at the point when acceptance occurs that indicates customer acknowledgment of delivery or installation, depending on the terms of the arrangement. Revenue from the implied obligation to deliver software enhancements if and when available is recognized ratably over the first year following installation of the system as the customer receives the right to software updates throughout the period and is included in Other Recurring Revenue. The Company’s system contracts generally do not provide a right of return. Systems are generally covered by a one-year assurance type warranty; warranty costs were not material for the periods presented. There was no revenue from system delivery and installation for the three months ended March 31, 2020. Revenue from system delivery and installation represented 1% of revenue for the three months ended March 31, 2019. Disposables: Revenue from sales of disposable products is recognized when control is transferred to the customers, which generally occurs at the time of shipment, but can also occur at the time of delivery depending on the customer arrangement. Disposable products are covered by an assurance type warranty that provides for the return of defective products. Warranty costs were not material for the periods presented. Disposable revenue represented 34% and 36% of revenue for the three months ended March 31, 2020 and 2019, respectively. Royalty: The Company is entitled to royalty payments from Biosense Webster, payable quarterly based on net revenues from sales of the co-developed catheters. Royalty revenue from the co-developed catheters represented 10% and 11% of revenue for the three months ended March 31, 2020 and 2019, respectively. Other Recurring Revenue: Other recurring revenue includes revenue from product maintenance plans, other post warranty maintenance, and the implied obligation to provide software enhancements if and when available for one year following installation. Revenue from services and software enhancements is deferred and amortized over the service or update period, which is typically one year. Revenue related to services performed on a time-and-materials basis is recognized when performed. Other recurring revenue represented 52% and 50% of revenue for the three months ended March 31, 2020 and 2019, respectively. Sublease Revenue: The adoption of new lease accounting guidance as of January 1, 2019 required the Company to record sublease income as revenue beginning in 2019. Sublease revenue represented 4% and 3% of revenue for the three months ended March 31, 2020 and 2019, respectively. Three Months Ended March 31, 2020 2019 Systems $ - $ 58,051 Disposables, service and accessories 5,509,711 6,710,759 Sublease 246,530 241,065 Total revenue $ 5,756,241 $ 7,009,875 Transaction price allocated to remaining performance obligations relates to amounts allocated to products and services for which the revenue has not yet been recognized. A significant portion of this amount relates to the Company’s systems contracts and obligations that will be recognized as revenue in future periods. These obligations are generally satisfied within two years after contract inception but may occasionally extend longer. Transaction price representing revenue to be earned on remaining performance obligations on system contracts was approximately $4.6 million as of March 31, 2020. Performance obligations arising from contracts for disposables, royalty and service are generally expected to be satisfied within one year after entering into the contract. The following information summarizes the Company’s contract assets and liabilities: March 31, 2019 December 31, 2019 Contract Assets - Unbilled Receivables $ 99,793 $ 168,445 Customer deposits 597,000 - Product shipped, revenue deferred 674,666 674,324 Deferred service and license fees 4,505,738 4,972,389 Total deferred revenue 5,777,404 5,646,713 Less: Long-term deferred revenue (510,689 ) (554,258 ) Total current deferred revenue $ 5,266,715 $ 5,092,455 The Company invoices its customers based on the billing schedules in its sales arrangements. Contract assets primarily represent the difference between the revenue that was earned but not billed on service contracts and revenue from system contracts that was recognized based on the relative selling price of the related performance obligations and the contractual billing terms in the arrangements. Deferred revenue is primarily related to service contracts, for which the service fees are billed up-front, generally quarterly or annually, and for amounts billed in advance for system contracts for which some performance obligations remain outstanding. For service contracts, the associated deferred revenue is generally recognized ratably over the service period. For system contracts, the associated deferred revenue is recognized when the remaining performance obligations are satisfied. The Company did not have any impairment losses on its contract assets for the periods presented. Revenue recognized for the three months ended March 31, 2020 and 2019, that was included in the deferred revenue balance at the beginning of each reporting period was $2.6 million and $2.9 million respectively. Assets Recognized from the Costs to Obtain a Contract with a Customer The Company has determined that sales incentive programs for the Company’s sales team meet the requirements to be capitalized as the Company expects to generate future economic benefits from the related revenue generating contracts after the initial capital sales transaction. The costs capitalized as contract acquisition costs included in prepaid expenses and other assets in the Company’s balance sheet were $0.3 million as of and March 31, 2020 and December 31, 2019. The Company did not incur any impairment losses during any of the periods presented. Costs of systems revenue include direct product costs, installation labor and other costs, estimated warranty costs, and initial training and product maintenance costs. These costs are recorded at the time of sale. Costs of disposable revenue include direct product costs and estimated warranty costs and are recorded at the time of sale. Cost of revenue from services and license fees are recorded when incurred. Share-Based Compensation The Company accounts for its grants of stock options, stock appreciation rights, restricted shares, and restricted stock units and for its employee stock purchase plan in accordance with the provisions of general accounting principles for share-based payments. These accounting principles require the determination of the fair value of the share-based compensation at the grant date and the recognition of the related expense over the period in which the share-based compensation vests. The Company utilizes the Black-Scholes valuation model to determine the fair value of stock options and stock appreciation rights at the date of grant. The resulting compensation expense is recognized over the requisite service period, which is generally four years. Restricted shares and units granted to employees are valued at the fair market value at the date of grant. The Company amortizes the fair market value to expense over the service period. If the shares are subject to performance objectives, the resulting compensation expense is amortized over the anticipated vesting period and is subject to adjustment based on the actual achievement of objectives. Net Earnings (Loss) per Common Share Basic earnings (loss) per common share is computed by dividing the net earnings (loss) for the period by the weighted average number of common shares outstanding during the period. In periods where there is net income, we apply the two-class method to calculate basic and diluted net income (loss) per share of common stock, as our Convertible Preferred Stock is a participating security. The two-class method is an earnings allocation formula that treats a participating security as having rights to earnings that otherwise would have been available to common stockholders. In periods where there is a net loss, the two-class method of computing earnings per share does not apply as our Convertible Preferred Stock does not contractually participate in our losses. We compute diluted net income (loss) per common share using net income (loss) as the “control number” in determining whether potential common shares are dilutive, after giving consideration to all potentially dilutive common shares, including stock options, warrants, unvested restricted stock units outstanding during the period and potential issuance of stock upon the conversion of our Convertible Preferred Stock issued and outstanding during the period, except where the effect of such securities would be antidilutive. The following table sets forth the computation of basic and diluted EPS: Three Months Ended March 31, 2020 2019 Net loss $ (1,971,531 ) $ (2,122,820 ) Cumulative dividend on convertible preferred stock (343,723 ) (353,510 ) Net loss attributable to common stockholders $ (2,315,254 ) $ (2,476,330 ) Weighted average number of common shares and equivalents: 69,870,040 59,196,652 Basic EPS $ (0.03 ) $ (0.04 ) Diluted EPS $ (0.03 ) $ (0.04 ) The Company did not include any portion of unearned restricted shares, outstanding options, stock appreciation rights, warrants or convertible preferred stock in the calculation of diluted loss per common share because all such securities are anti-dilutive for all periods presented. The application of the two-class method of computing earnings per share under general accounting principles for participating securities is not applicable during these periods because those securities do not contractually participate in its losses. As of March 31, 2020, the Company had 2,661,002 shares of common stock issuable upon the exercise of outstanding options and stock appreciation rights at a weighted average exercise price of $2.97 per share, 15,385 shares of common stock issuable upon the exercise of outstanding warrants at a weighted average exercise price of $0.70 per share, 42,671,430 shares of common stock issuable upon the conversion of Series A Convertible Preferred Stock and accumulated dividends, 5,610,121 shares of common stock issuable upon the conversion of Series B Convertible Preferred Stock, and 940,973 shares of unvested restricted share units. Recently Issued Accounting Pronouncements In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes” as part of its effort to reduce the complexity of accounting standards. The ASU is effective for fiscal years beginning after December 15, 2020. The Company does not expect that the adoption of this new guidance will have a material impact on the Company’s financial results. In June 2016, the FASB issued ASU 2016-13, “Financial Instruments-Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments” and also issued subsequent amendments to the initial guidance under ASU 2018-19, ASU 2019-04 and ASU 2019-05. The standard modifies the measurement approach for credit losses on financial instruments, including trade receivables, from an incurred loss method to a current expected credit loss method, otherwise known as “CECL.” The standard requires the measurement of expected credit losses to be based on relevant information, including historical experience, current conditions and a forecast that is supportable. The standard is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years; early adoption is permitted. The standard must be adopted by applying a cumulative adjustment to retained earnings. The Company anticipates adopting the standard in the first quarter of 2023, although it does not expect a significant impact to the Company’s financial results. |
Inventories
Inventories | 3 Months Ended |
Mar. 31, 2020 | |
Inventory Disclosure [Abstract] | |
Inventories | 3. Inventories Inventories consist of the following: March 31, 2020 December 31, 2019 Raw materials $ 3,820,618 $ 3,063,532 Work in process 454,135 515,262 Finished goods 2,784,171 2,164,187 Reserve for obsolescence (3,888,784 ) (3,895,451 ) Total inventory $ 3,170,140 $ 1,847,530 |
Prepaid Expenses and Other Asse
Prepaid Expenses and Other Assets | 3 Months Ended |
Mar. 31, 2020 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Prepaid Expenses and Other Assets | 4. Prepaid Expenses and Other Assets Prepaid expenses and other assets consist of the following: March 31, 2020 December 31, 2019 Prepaid expenses $ 422,061 $ 640,252 Prepaid commissions 307,339 336,594 Deposits 857,777 712,179 Total prepaid expenses and other assets 1,587,177 1,689,025 Less: Noncurrent prepaid expenses and other assets (196,674 ) (218,103 ) Total current prepaid expenses and other assets $ 1,390,503 $ 1,470,922 |
Property and Equipment
Property and Equipment | 3 Months Ended |
Mar. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | 5. Property and Equipment March 31, 2020 December 31, 2019 Equipment $ 6,485,873 $ 6,485,873 Leasehold improvements 2,338,441 2,338,441 8,824,314 8,824,314 Less: Accumulated depreciation (8,603,990 ) (8,573,871 ) Net property and equipment $ 220,324 $ 250,443 |
Leases
Leases | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Leases | 6. Leases A lease is defined as a contract, or part of a contract, that conveys the right to control the use of identified property, plant or equipment for a period of time in exchange for consideration. On January 1, 2019, the Company adopted ASU No. 2016-02 “Leases” (Topic 842) The Company leases its facilities under operating leases, which were previously not recognized on the Company’s balance sheets. With the adoption of ASC 842, operating lease agreements are required to be recognized on the balance sheet as a right-of-use (“ROU”) asset and a corresponding lease liability. These leases do not have significant rent escalation holidays, concessions, leasehold improvement incentives, or other build-out clauses. Further, the leases do not contain contingent rent provisions. Many of our leases include both lease (i.e., fixed payments including rent, taxes, and insurance costs) and non-lease components (i.e., common-area or other maintenance costs) which are accounted for as a single lease component as we have elected the practical expedient to group lease and non-lease components for all leases. A portion of our principal executive office is subleased to a third party through 2021. The sublease does not have significant rent escalation holidays, concessions, leasehold improvement incentives, or other build-out clauses. In addition, the sublease does not contain contingent rent provisions nor are there options to extend or terminate the sublease. The Company’s lease agreements often include one or more options to renew at the Company’s discretion. If at lease inception, the Company considers the exercising of a renewal option to be reasonably certain, the Company will include the extended term in the calculation of the ROU asset and lease liability. The Company elected not to include short-term leases (i.e. leases with initial terms of twelve months or less) on the balance sheet. The calculated amounts of the ROU assets and lease liabilities are impacted by the length of the lease term and the discount rate used to calculate the present value of the minimum lease payments. ASC 842 requires the use of the discount rate implicit in the lease whenever this rate is readily determinable. As this rate is rarely determinable, the Company utilizes its incremental borrowing rate at lease inception. At March 31, 2020, the weighted average discount rate for operating leases was 9.0% and the weighted average remaining lease term for operating lease term is 1.75 years. The following table represents lease costs and other lease information. Three Months Ended Three Months Ended March 31, 2020 March 31, 2019 Operating lease cost $ 585,586 $ 585,586 Short-term lease cost 15,470 19,809 Sublease income (246,530 ) (241,065 ) Total lease cost $ 354,526 $ 364,330 Cash paid within operating cash flows $ 636,350 $ 615,266 The initial recognition of the right of use assets in 2019 was $6.2 million. Variable lease costs consist primarily of taxes, insurance, and common area or other maintenance costs for our leased facilities and equipment which are paid based on actual costs incurred. Future minimum payments for operating leases with initial or remaining terms of one year or more as of March 31, 2020, excluding sublease income, were as follows: March 31, 2020 2020 $ 1,754,379 2021 2,382,661 2022 and thereafter - Total lease payments $ 4,137,040 Less: Interest (295,237 ) Present value of lease liabilities $ 3,841,803 The undiscounted future cash flows to be received under the sublease are $0.7 million in 2020 and $1.0 million in 2021. |
Accrued Liabilities
Accrued Liabilities | 3 Months Ended |
Mar. 31, 2020 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities | 7. Accrued Liabilities Accrued liabilities consist of the following: March 31, 2020 December 31, 2019 Accrued salaries, bonus, and benefits $ 1,055,345 $ 1,421,150 Accrued licenses and maintenance fees 483,879 483,879 Accrued warranties 133,433 141,697 Accrued taxes 169,654 206,232 Accrued professional services 415,342 383,342 Other 340,061 340,321 Total accrued liabilities 2,597,714 2,976,621 Less: Long term accrued liabilities (255,517 ) (255,517 ) Total current accrued liabilities $ 2,342,197 $ 2,721,104 |
Long-Term Debt and Credit Facil
Long-Term Debt and Credit Facilities | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Long-Term Debt and Credit Facilities | 8. Long-Term Debt and Credit Facilities The Company has had a working capital line of credit with its primary lender, Silicon Valley Bank, since 2004. The working capital line of credit matures on June 30, 2020. The revolving line of credit is secured by substantially all of the Company’s assets. The maximum available under the line is $5.0 million subject to the value of collateralized assets and the interest rate is equal to the prime rate subject to a floor of 4.5%. The Company is required under the revolving line of credit to maintain its primary operating account and the majority of its cash and investment balances in accounts with its primary lender. On June 27, 2019, the Company entered into a Second Amendment to and Reinstatement of Third Amended and Restated Loan and Security Agreement with Silicon Valley Bank to extend the maturity of the revolving line of credit to June 30, 2020 under substantially identical terms to the prior agreement. As of March 31, 2020, the Company had no outstanding balance under the revolving line of credit. Draws on the line of credit were made based on the borrowing capacity one week in arrears. As of March 31, 2020, the Company had a borrowing capacity of $3.4 million based on the Company’s collateralized assets. The Company’s total liquidity as of March 31, 2020, was $31.4 million which included cash and cash equivalents of $28.0 million. |
Convertible Preferred Stock and
Convertible Preferred Stock and Stockholders' Equity | 3 Months Ended |
Mar. 31, 2020 | |
Stockholders' Equity Note [Abstract] | |
Convertible Preferred Stock and Stockholders' Equity | 9. Convertible Preferred Stock and Stockholders’ Equity The holders of common stock are entitled to one vote for each share held and to receive dividends whenever funds are legally available and when declared by the Board of Directors subject to the rights of holders of all classes of stock having priority rights as dividends and the conditions of the revolving line of credit agreement. No dividends have been declared or paid as of March 31, 2020. 2019 Equity Financing and Series B Convertible Preferred Stock On August 7, 2019, the Company entered into a Securities Purchase Agreement with certain institutional and other accredited investors, whereby it, in a private placement, agreed to issue and sell to the investors an aggregate of 6,585,000 shares of the Company’s common stock, $0.001 par value per share, at a price of $2.05 per share and 5,610,121 shares of the Company’s Series B Convertible Preferred Stock, $0.001 par value per share which are convertible into shares of the Company’s Common Stock, at a price of $2.05 per share. The Series B Preferred Stock, which is a Common Stock equivalent but non-voting and with a blocker on conversion if the holder would exceed a specified threshold of voting security ownership, is convertible into Common Stock on a one-for-one basis, subject to adjustment for events such as stock splits, combinations and the like as provided in the Purchase Agreement. The Series B Convertible Preferred Stock is reported in the stockholder’s equity section of the Company’s balance sheet. The Company received net proceeds of approximately $23.1 million, after offering expenses. Series A Convertible Preferred Stock and Warrants In September 2016, the Company issued 24,000 shares of Series A Convertible Preferred Stock, par value $0.001 with a stated value of $1,000 per share which are convertible into shares of the Company’s common stock at an initial conversion rate of $0.65 per share and (ii) warrants to purchase an aggregate of 36,923,078 shares of common stock. The convertible preferred shares are entitled to vote on an as-converted basis with the common stock, subject to specified beneficial ownership issuance limitations. The convertible preferred shares bear dividends at a rate of six percent (6%) per annum, which are cumulative and accrue daily from the date of issuance on the $1,000 stated value. Such dividends will not be paid in cash except in connection with any liquidation, dissolution or winding up of the Company or any redemption of the convertible preferred shares. Each holder of convertible preferred shares has the right to require us to redeem such holder’s convertible preferred shares upon the occurrence of specified events, which include certain business combinations, the sale of all or substantially all of the Company’s assets, or the sale of more than 50% of the outstanding shares of the Company’s common stock. In addition, the Company has the right to redeem the convertible preferred shares in the event of a defined change of control. The convertible preferred shares rank senior to our common stock as to distributions and payments upon the liquidation, dissolution, and winding up of the Company. Since the convertible preferred shares are subject to conditions for redemption that are outside the Company’s control, the convertible preferred shares are presently reported in the mezzanine section of the balance sheet. The warrants issued in conjunction with the convertible preferred stock (the “SPA Warrants”) have an exercise price equal to $0.70 per share subject to adjustments as provided under the terms of the warrants. The warrants are exercisable through September 29, 2021, subject to specified beneficial ownership issuance limitations. Stock Award Plans The Company has various stock plans that permit the Company to provide incentives to employees and directors of the Company in the form of equity compensation. In July 2012, the Compensation Committee of the Board of Directors adopted the 2012 Stock Incentive Plan (the “Plan”) which was subsequently approved by the Company’s shareholders. This plan replaced the 2002 Stock Incentive Plan which expired on March 25, 2012. At March 31, 2020, the Company had 2,192,829 remaining shares of the Company’s common stock to provide for current and future grants under its various equity plans. At March 31, 2020, the total compensation cost related to options, stock appreciation rights, and non-vested stock granted to employees under the Company’s stock award plans but not yet recognized was approximately $4.3 million. This cost will be amortized over a period of up to four years over the underlying estimated service periods and will be adjusted for subsequent changes in actual forfeitures and anticipated vesting periods. A summary of the option and stock appreciation rights activity for the three month period ended March 31, 2020 is as follows: Number of Options/SARs Range of Exercise Price Weighted Average Exercise Price per Share Outstanding, December 31, 2019 1,857,599 $0.74 - $36.20 $ 2.22 Granted 887,250 $3.98 - $4.52 $ 4.51 Exercised (10,046 ) $0.74 - $2.03 $ 1.19 Forfeited (73,801 ) $0.74 - $4.04 $ 2.75 Outstanding, March 31, 2020 2,661,002 $0.74 - $36.20 $ 2.97 A summary of the restricted stock unit activity for the three month period ended March 31, 2020 is as follows: Number of Restricted Stock Units Weighted Average Grant Date Fair Value per Unit Outstanding, December 31, 2019 840,712 $ 1.28 Granted 210,000 $ 5.24 Vested (109,489 ) $ 2.00 Forfeited (250 ) $ 0.78 Outstanding, March 31, 2020 940,973 $ 2.08 |
Product Warranty Provisions
Product Warranty Provisions | 3 Months Ended |
Mar. 31, 2020 | |
Product Warranties Disclosures [Abstract] | |
Product Warranty Provisions | 10. Product Warranty Provisions The Company’s standard policy is to warrant all capital systems against defects in material or workmanship for one year following installation. The Company’s estimate of costs to service the warranty obligations is based on historical experience and current product performance trends. A regular review of warranty obligations is performed to determine the adequacy of the reserve and adjustments are made to the estimated warranty liability as appropriate. Accrued warranty, which is included in other accrued liabilities, consists of the following: March 31, 2020 December 31, 2019 Warranty accrual, beginning of the fiscal period $ 141,697 $ 149,464 Accrual adjustment for product warranty 7,637 56,118 Payments made (15,901 ) (63,885 ) Warranty accrual, end of the fiscal period $ 133,433 $ 141,697 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 11. Commitments and Contingencies The Company at times becomes a party to claims in the ordinary course of business. Management believes that the ultimate resolution of pending or threatened proceedings will not have a material effect on the financial position, results of operations or liquidity of the Company. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | 12. Subsequent Events The Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was enacted on March 27, 2020 in the United States. Among the provisions contained in the CARES Act is the creation of the Paycheck Protection Program that provides for Small Business Administration (“SBA”) Section 7(a) loans for qualified small businesses. The loan can be forgiven as long as the funds are used for payroll related expenses as well rent and utilities paid during the eight week period from the date of the loan. On April 10, 2020, the Company was informed by its lender, Midwest BankCentre (the “Bank”), that the Bank received approval from the SBA to fund the Company’s request for a loan under the SBA’s Paycheck Protection Program (“PPP Loan”). Per the terms of the PPP Loan, the Company received total proceeds of $2,158,310 from the Bank on April 20, 2020. In accordance with the loan forgiveness requirements of the CARES Act, the Company intends to use the proceeds from the PPP Loan primarily for payroll costs, rent and utilities, thus 100% of the loan should be forgiven. The PPP Loan is scheduled to mature on April 20, 2022, has a 1.00% interest rate, and is subject to the terms and conditions applicable to all loans made pursuant to the Paycheck Protection Program as administered by the SBA under the CARES Act. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited financial statements of Stereotaxis, Inc. have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and the instructions to Form 10-Q. Accordingly, they do not include all the disclosures required by GAAP for complete financial statements. In the opinion of management, they include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results for the interim periods presented. Operating results for the three month period ended March 31, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020 or for future operating periods. These interim financial statements and the related notes should be read in conjunction with the annual financial statements and notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 as filed with the Securities and Exchange Commission (SEC) on March 16, 2020. |
Risks and Uncertainties | Risks and Uncertainties The novel coronavirus COVID-19 (“COVID-19”) pandemic has resulted, and is likely to continue to result, in significant disruptions to the economy, as well as business and capital markets around the world. The full extent of the impact of the COVID-19 pandemic on our business, results of operations and financial condition will depend on numerous evolving factors that we may not be able to accurately predict. As a result of the COVID-19 outbreak, we have experienced business disruptions, including travel restrictions on us and our third-party distributors, which have negatively affected our complex sales, marketing, installation, distribution and service network relating to our products and services. The COVID-19 pandemic may continue to negatively affect demand for our both our systems and our disposable products by limiting the ability of our sales personnel to maintain their customary contacts with customers as governmental authorities institute prolonged quarantines, travel restrictions, and shelter-in-place orders, or as our customers impose limitations on contacts and in-person meetings that go beyond those imposed by governmental authorities. In addition, many of our hospital customers, for whom the purchase of our system involves a significant capital purchase which may be part of a larger construction project at the customer site (typically the construction of a new building), may themselves be under economic pressures. This may cause delays or cancellations of current purchase orders and other commitments, and may exacerbate the long and variable sales and installation cycles for our robotic systems products. We may also experience significant reductions in demand for our disposable products as our healthcare customers (physicians and hospitals) continue to re-prioritize the treatment of patients and divert resources away from non-coronavirus areas, which we anticipate will lead to the performance of fewer procedures in which our disposable products are used. In addition, patients may consider foregoing or deferring procedures utilizing our products, even if physicians and hospitals are willing to perform them, which could also reduce demand for, and sales of, our disposable products. As of the date of the filing of this Quarterly Report on Form 10-Q, we believe our manufacturing operations and supply chains have been minimally interrupted, but we cannot guarantee that they will not be interrupted more severely in the future. If our manufacturing operations or supply chains are materially interrupted, it may not be possible for us to timely manufacture relevant products at required levels, or at all. A material reduction or interruption to any of our manufacturing processes would have a material adverse effect on our business, operating results, and financial condition. As governmental authorities around the world continue to institute prolonged mandatory closures, social distancing protocols and shelter-in-place orders, or as private parties on whom we rely to operate our business put in place their own protocols that go beyond those instituted by relevant governmental authorities, our ability to adequately staff and maintain our operations or further our product development could be negatively impacted. Any continued disruption to the capital markets could negatively impact our ability to raise capital. If the capital markets continue to be disrupted for an extended period of time and we need to raise additional capital, such capital may not be available on acceptable terms, or at all. Continued disruptions to the capital markets and other financing sources could also negatively impact our hospital customers’ ability to raise capital or otherwise obtain financing to fund their operations and capital projects. Such could result in delayed spending on current projects, a longer sales cycle for new projects where a large capital commitment is required, and decreased demand for our disposable products as well as an increased risk of customer defaults or delays in payments for our systems installations, and for our service contracts and disposable products. We are evaluating and taking actions to reduce costs and spending across our organization. We will continue to actively monitor the situation and may take further actions that alter our business operations as may be required by federal, state or local governmental authorities that may be implemented by our vendors, supplier or customers, or that we determine are in the best interests of our employees, customers, suppliers and shareholders. |
Financial Instruments | Financial Instruments Financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable, and debt. The carrying value of such amounts reported at the applicable balance sheet dates approximates fair value. The Company measures certain financial assets and liabilities at fair value on a recurring basis. General accounting principles for fair value measurement established a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets and liabilities (“Level 1”) and the lowest priority to unobservable inputs (“Level 3”). As of March 31, 2020 and December 31, 2019 the Company did not have any financial assets or liabilities valued at fair value on a recurring basis. |
Revenue and Costs of Revenue | Revenue and Costs of Revenue The Company accounts for revenue in accordance with Accounting Standards Codification Topic 606 (“ASC 606”), Revenue from Contracts with Customers We generate revenue from initial capital sales of systems as well as recurring revenue from the sale of our proprietary disposable devices, from royalties paid to the Company on the sale by Biosense Webster of co-developed catheters, and from other recurring revenue including ongoing software updates and service contracts. We account for a contract with a customer when there is a legally enforceable contract between the Company and the customer, the rights of the parties are identified, the contract has commercial substance, and collectability of the contract consideration is probable. We record our revenue based on consideration specified in the contract with each customer, net of any taxes collected from customers that are remitted to government authorities. For contracts containing multiple products and services, the Company accounts for individual products and services as separate performance obligations if they are distinct, which is if a product or service is separately identifiable from other items in the bundled package, and if a customer can benefit from it on its own or with other resources that are readily available to the customer. The Company recognizes revenues as the performance obligations are satisfied by transferring control of the product or service to a customer. For arrangements with multiple performance obligations, revenue is allocated to each performance obligation based on its relative standalone selling price. Standalone selling prices are based on observable prices at which the Company separately sells the products or services. If a standalone selling price is not directly observable, then the Company estimates the standalone selling price considering market conditions and entity-specific factors including, but not limited to, features and functionality of the products and services and market conditions. The Company regularly reviews standalone selling prices and updates these estimates as necessary. Systems: Contracts related to the sale of systems typically contain separate obligations for the delivery of system(s), installation and an implied obligation to provide software enhancements if and when available for one year following installation. Revenue is recognized when the Company transfers control to the customer, which is generally at the point when acceptance occurs that indicates customer acknowledgment of delivery or installation, depending on the terms of the arrangement. Revenue from the implied obligation to deliver software enhancements if and when available is recognized ratably over the first year following installation of the system as the customer receives the right to software updates throughout the period and is included in Other Recurring Revenue. The Company’s system contracts generally do not provide a right of return. Systems are generally covered by a one-year assurance type warranty; warranty costs were not material for the periods presented. There was no revenue from system delivery and installation for the three months ended March 31, 2020. Revenue from system delivery and installation represented 1% of revenue for the three months ended March 31, 2019. Disposables: Revenue from sales of disposable products is recognized when control is transferred to the customers, which generally occurs at the time of shipment, but can also occur at the time of delivery depending on the customer arrangement. Disposable products are covered by an assurance type warranty that provides for the return of defective products. Warranty costs were not material for the periods presented. Disposable revenue represented 34% and 36% of revenue for the three months ended March 31, 2020 and 2019, respectively. Royalty: The Company is entitled to royalty payments from Biosense Webster, payable quarterly based on net revenues from sales of the co-developed catheters. Royalty revenue from the co-developed catheters represented 10% and 11% of revenue for the three months ended March 31, 2020 and 2019, respectively. Other Recurring Revenue: Other recurring revenue includes revenue from product maintenance plans, other post warranty maintenance, and the implied obligation to provide software enhancements if and when available for one year following installation. Revenue from services and software enhancements is deferred and amortized over the service or update period, which is typically one year. Revenue related to services performed on a time-and-materials basis is recognized when performed. Other recurring revenue represented 52% and 50% of revenue for the three months ended March 31, 2020 and 2019, respectively. Sublease Revenue: The adoption of new lease accounting guidance as of January 1, 2019 required the Company to record sublease income as revenue beginning in 2019. Sublease revenue represented 4% and 3% of revenue for the three months ended March 31, 2020 and 2019, respectively. Three Months Ended March 31, 2020 2019 Systems $ - $ 58,051 Disposables, service and accessories 5,509,711 6,710,759 Sublease 246,530 241,065 Total revenue $ 5,756,241 $ 7,009,875 Transaction price allocated to remaining performance obligations relates to amounts allocated to products and services for which the revenue has not yet been recognized. A significant portion of this amount relates to the Company’s systems contracts and obligations that will be recognized as revenue in future periods. These obligations are generally satisfied within two years after contract inception but may occasionally extend longer. Transaction price representing revenue to be earned on remaining performance obligations on system contracts was approximately $4.6 million as of March 31, 2020. Performance obligations arising from contracts for disposables, royalty and service are generally expected to be satisfied within one year after entering into the contract. The following information summarizes the Company’s contract assets and liabilities: March 31, 2019 December 31, 2019 Contract Assets - Unbilled Receivables $ 99,793 $ 168,445 Customer deposits 597,000 - Product shipped, revenue deferred 674,666 674,324 Deferred service and license fees 4,505,738 4,972,389 Total deferred revenue 5,777,404 5,646,713 Less: Long-term deferred revenue (510,689 ) (554,258 ) Total current deferred revenue $ 5,266,715 $ 5,092,455 The Company invoices its customers based on the billing schedules in its sales arrangements. Contract assets primarily represent the difference between the revenue that was earned but not billed on service contracts and revenue from system contracts that was recognized based on the relative selling price of the related performance obligations and the contractual billing terms in the arrangements. Deferred revenue is primarily related to service contracts, for which the service fees are billed up-front, generally quarterly or annually, and for amounts billed in advance for system contracts for which some performance obligations remain outstanding. For service contracts, the associated deferred revenue is generally recognized ratably over the service period. For system contracts, the associated deferred revenue is recognized when the remaining performance obligations are satisfied. The Company did not have any impairment losses on its contract assets for the periods presented. Revenue recognized for the three months ended March 31, 2020 and 2019, that was included in the deferred revenue balance at the beginning of each reporting period was $2.6 million and $2.9 million respectively. |
Assets Recognized from the Costs to Obtain a Contract with a Customer | Assets Recognized from the Costs to Obtain a Contract with a Customer The Company has determined that sales incentive programs for the Company’s sales team meet the requirements to be capitalized as the Company expects to generate future economic benefits from the related revenue generating contracts after the initial capital sales transaction. The costs capitalized as contract acquisition costs included in prepaid expenses and other assets in the Company’s balance sheet were $0.3 million as of and March 31, 2020 and December 31, 2019. The Company did not incur any impairment losses during any of the periods presented. Costs of systems revenue include direct product costs, installation labor and other costs, estimated warranty costs, and initial training and product maintenance costs. These costs are recorded at the time of sale. Costs of disposable revenue include direct product costs and estimated warranty costs and are recorded at the time of sale. Cost of revenue from services and license fees are recorded when incurred. |
Share-Based Compensation | Share-Based Compensation The Company accounts for its grants of stock options, stock appreciation rights, restricted shares, and restricted stock units and for its employee stock purchase plan in accordance with the provisions of general accounting principles for share-based payments. These accounting principles require the determination of the fair value of the share-based compensation at the grant date and the recognition of the related expense over the period in which the share-based compensation vests. The Company utilizes the Black-Scholes valuation model to determine the fair value of stock options and stock appreciation rights at the date of grant. The resulting compensation expense is recognized over the requisite service period, which is generally four years. Restricted shares and units granted to employees are valued at the fair market value at the date of grant. The Company amortizes the fair market value to expense over the service period. If the shares are subject to performance objectives, the resulting compensation expense is amortized over the anticipated vesting period and is subject to adjustment based on the actual achievement of objectives. |
Net Earnings (Loss) Per Common Share | Net Earnings (Loss) per Common Share Basic earnings (loss) per common share is computed by dividing the net earnings (loss) for the period by the weighted average number of common shares outstanding during the period. In periods where there is net income, we apply the two-class method to calculate basic and diluted net income (loss) per share of common stock, as our Convertible Preferred Stock is a participating security. The two-class method is an earnings allocation formula that treats a participating security as having rights to earnings that otherwise would have been available to common stockholders. In periods where there is a net loss, the two-class method of computing earnings per share does not apply as our Convertible Preferred Stock does not contractually participate in our losses. We compute diluted net income (loss) per common share using net income (loss) as the “control number” in determining whether potential common shares are dilutive, after giving consideration to all potentially dilutive common shares, including stock options, warrants, unvested restricted stock units outstanding during the period and potential issuance of stock upon the conversion of our Convertible Preferred Stock issued and outstanding during the period, except where the effect of such securities would be antidilutive. The following table sets forth the computation of basic and diluted EPS: Three Months Ended March 31, 2020 2019 Net loss $ (1,971,531 ) $ (2,122,820 ) Cumulative dividend on convertible preferred stock (343,723 ) (353,510 ) Net loss attributable to common stockholders $ (2,315,254 ) $ (2,476,330 ) Weighted average number of common shares and equivalents: 69,870,040 59,196,652 Basic EPS $ (0.03 ) $ (0.04 ) Diluted EPS $ (0.03 ) $ (0.04 ) The Company did not include any portion of unearned restricted shares, outstanding options, stock appreciation rights, warrants or convertible preferred stock in the calculation of diluted loss per common share because all such securities are anti-dilutive for all periods presented. The application of the two-class method of computing earnings per share under general accounting principles for participating securities is not applicable during these periods because those securities do not contractually participate in its losses. As of March 31, 2020, the Company had 2,661,002 shares of common stock issuable upon the exercise of outstanding options and stock appreciation rights at a weighted average exercise price of $2.97 per share, 15,385 shares of common stock issuable upon the exercise of outstanding warrants at a weighted average exercise price of $0.70 per share, 42,671,430 shares of common stock issuable upon the conversion of Series A Convertible Preferred Stock and accumulated dividends, 5,610,121 shares of common stock issuable upon the conversion of Series B Convertible Preferred Stock, and 940,973 shares of unvested restricted share units. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes” as part of its effort to reduce the complexity of accounting standards. The ASU is effective for fiscal years beginning after December 15, 2020. The Company does not expect that the adoption of this new guidance will have a material impact on the Company’s financial results. In June 2016, the FASB issued ASU 2016-13, “Financial Instruments-Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments” and also issued subsequent amendments to the initial guidance under ASU 2018-19, ASU 2019-04 and ASU 2019-05. The standard modifies the measurement approach for credit losses on financial instruments, including trade receivables, from an incurred loss method to a current expected credit loss method, otherwise known as “CECL.” The standard requires the measurement of expected credit losses to be based on relevant information, including historical experience, current conditions and a forecast that is supportable. The standard is effective for fiscal years beginning after December 15, 2022, including interim periods within those fiscal years; early adoption is permitted. The standard must be adopted by applying a cumulative adjustment to retained earnings. The Company anticipates adopting the standard in the first quarter of 2023, although it does not expect a significant impact to the Company’s financial results. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Schedule of Revenue Disaggregated by Type | Three Months Ended March 31, 2020 2019 Systems $ - $ 58,051 Disposables, service and accessories 5,509,711 6,710,759 Sublease 246,530 241,065 Total revenue $ 5,756,241 $ 7,009,875 |
Summary of Contract Assets and Liabilities | The following information summarizes the Company’s contract assets and liabilities: March 31, 2019 December 31, 2019 Contract Assets - Unbilled Receivables $ 99,793 $ 168,445 Customer deposits 597,000 - Product shipped, revenue deferred 674,666 674,324 Deferred service and license fees 4,505,738 4,972,389 Total deferred revenue 5,777,404 5,646,713 Less: Long-term deferred revenue (510,689 ) (554,258 ) Total current deferred revenue $ 5,266,715 $ 5,092,455 |
Schedule of Computation of Basic and Diluted Earnings Per Share | The following table sets forth the computation of basic and diluted EPS: Three Months Ended March 31, 2020 2019 Net loss $ (1,971,531 ) $ (2,122,820 ) Cumulative dividend on convertible preferred stock (343,723 ) (353,510 ) Net loss attributable to common stockholders $ (2,315,254 ) $ (2,476,330 ) Weighted average number of common shares and equivalents: 69,870,040 59,196,652 Basic EPS $ (0.03 ) $ (0.04 ) Diluted EPS $ (0.03 ) $ (0.04 ) |
Inventories (Tables)
Inventories (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | Inventories consist of the following: March 31, 2020 December 31, 2019 Raw materials $ 3,820,618 $ 3,063,532 Work in process 454,135 515,262 Finished goods 2,784,171 2,164,187 Reserve for obsolescence (3,888,784 ) (3,895,451 ) Total inventory $ 3,170,140 $ 1,847,530 |
Prepaid Expenses and Other As_2
Prepaid Expenses and Other Assets (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of Prepaid Expenses and Other Assets | Prepaid expenses and other assets consist of the following: March 31, 2020 December 31, 2019 Prepaid expenses $ 422,061 $ 640,252 Prepaid commissions 307,339 336,594 Deposits 857,777 712,179 Total prepaid expenses and other assets 1,587,177 1,689,025 Less: Noncurrent prepaid expenses and other assets (196,674 ) (218,103 ) Total current prepaid expenses and other assets $ 1,390,503 $ 1,470,922 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | March 31, 2020 December 31, 2019 Equipment $ 6,485,873 $ 6,485,873 Leasehold improvements 2,338,441 2,338,441 8,824,314 8,824,314 Less: Accumulated depreciation (8,603,990 ) (8,573,871 ) Net property and equipment $ 220,324 $ 250,443 |
Leases (Tables)
Leases (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Schedule of Lease Costs and Other Lease Information | The following table represents lease costs and other lease information. Three Months Ended Three Months Ended March 31, 2020 March 31, 2019 Operating lease cost $ 585,586 $ 585,586 Short-term lease cost 15,470 19,809 Sublease income (246,530 ) (241,065 ) Total lease cost $ 354,526 $ 364,330 Cash paid within operating cash flows $ 636,350 $ 615,266 |
Schedule of Future Minimum Operating Lease Payments | Future minimum payments for operating leases with initial or remaining terms of one year or more as of March 31, 2020, excluding sublease income, were as follows: March 31, 2020 2020 $ 1,754,379 2021 2,382,661 2022 and thereafter - Total lease payments $ 4,137,040 Less: Interest (295,237 ) Present value of lease liabilities $ 3,841,803 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Payables and Accruals [Abstract] | |
Schedule of Accrued Liabilities | Accrued liabilities consist of the following: March 31, 2020 December 31, 2019 Accrued salaries, bonus, and benefits $ 1,055,345 $ 1,421,150 Accrued licenses and maintenance fees 483,879 483,879 Accrued warranties 133,433 141,697 Accrued taxes 169,654 206,232 Accrued professional services 415,342 383,342 Other 340,061 340,321 Total accrued liabilities 2,597,714 2,976,621 Less: Long term accrued liabilities (255,517 ) (255,517 ) Total current accrued liabilities $ 2,342,197 $ 2,721,104 |
Convertible Preferred Stock a_2
Convertible Preferred Stock and Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Stockholders' Equity Note [Abstract] | |
Summary of Option and Stock Appreciation Rights Activity | A summary of the option and stock appreciation rights activity for the three month period ended March 31, 2020 is as follows: Number of Options/SARs Range of Exercise Price Weighted Average Exercise Price per Share Outstanding, December 31, 2019 1,857,599 $0.74 - $36.20 $ 2.22 Granted 887,250 $3.98 - $4.52 $ 4.51 Exercised (10,046 ) $0.74 - $2.03 $ 1.19 Forfeited (73,801 ) $0.74 - $4.04 $ 2.75 Outstanding, March 31, 2020 2,661,002 $0.74 - $36.20 $ 2.97 |
Summary of Restricted Stock Unit Activity | A summary of the restricted stock unit activity for the three month period ended March 31, 2020 is as follows: Number of Restricted Stock Units Weighted Average Grant Date Fair Value per Unit Outstanding, December 31, 2019 840,712 $ 1.28 Granted 210,000 $ 5.24 Vested (109,489 ) $ 2.00 Forfeited (250 ) $ 0.78 Outstanding, March 31, 2020 940,973 $ 2.08 |
Product Warranty Provisions (Ta
Product Warranty Provisions (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Product Warranties Disclosures [Abstract] | |
Schedule of Accrued Warranty | Accrued warranty, which is included in other accrued liabilities, consists of the following: March 31, 2020 December 31, 2019 Warranty accrual, beginning of the fiscal period $ 141,697 $ 149,464 Accrual adjustment for product warranty 7,637 56,118 Payments made (15,901 ) (63,885 ) Warranty accrual, end of the fiscal period $ 133,433 $ 141,697 |
Description of Business (Detail
Description of Business (Details Narrative) | Mar. 31, 2020Integer |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Installed base | 123 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Revenues | $ 5,756,241 | $ 7,009,875 | |
Remaining performance obligation | 4,600,000 | ||
Revenue recognized | 2,600,000 | $ 2,900,000 | |
Capitalized contract acquisition costs | $ 300,000 | $ 300,000 | |
Share-based compensation, requisite service period | 4 years | ||
Weighted average exercise price | $ 2.97 | $ 2.22 | |
Exercise price of warrants | $ 0.70 | ||
Series A Convertible Preferred Stock [Member] | |||
Potential common shares excluded from diluted earnings per share | 42,671,430 | ||
Series B Convertible Preferred Stock [Member] | |||
Potential common shares excluded from diluted earnings per share | 5,610,121 | ||
Warrants [Member] | |||
Potential common shares excluded from diluted earnings per share | 15,385 | ||
Exercise price of warrants | $ 0.70 | ||
Stock Options and Stock Appreciation Rights [Member] | |||
Potential common shares excluded from diluted earnings per share | 2,661,002 | ||
Weighted average exercise price | $ 2.97 | ||
Restricted Stock [Member] | |||
Number of unvested restricted share units | 940,973 | ||
Revenue from System Delivery and Installation [Member] | |||
Revenues | |||
Revenues percentage | 1.00% | ||
Disposable Revenue [Member] | |||
Revenues percentage | 34.00% | 36.00% | |
Royalty Revenue [Member] | |||
Revenues percentage | 10.00% | 11.00% | |
Other Recurring Revenue [Member] | |||
Revenues percentage | 52.00% | 50.00% | |
Sublease Revenue [Member] | |||
Revenues percentage | 4.00% | 3.00% |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Revenue Disaggregated by Type (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Total revenue | $ 5,756,241 | $ 7,009,875 |
Sublease | 246,530 | 241,065 |
Systems [Member] | ||
Total revenue | 58,051 | |
Disposables, Service and Accessories [Member] | ||
Total revenue | $ 5,509,711 | $ 6,710,759 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Summary of Contract Assets and Liabilities (Details) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Total deferred revenue | $ 5,777,404 | $ 5,646,713 |
Less: Long-term deferred revenue | (510,689) | (554,258) |
Total current deferred revenue | 5,266,715 | 5,092,455 |
Contract Assets - Unbilled Receivables [Member] | ||
Total deferred revenue | 99,793 | 168,445 |
Customer Deposits [Member] | ||
Total deferred revenue | 597,000 | |
Product Shipped, Revenue Deferred [Member] | ||
Total deferred revenue | 674,666 | 674,324 |
Deferred Service and License Fees [Member] | ||
Total deferred revenue | $ 4,505,738 | $ 4,972,389 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Schedule of Computation of Basic and Diluted Earnings Per Share (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Accounting Policies [Abstract] | ||
Net loss | $ (1,971,531) | $ (2,122,820) |
Cumulative dividend on convertible preferred stock | (343,723) | (353,510) |
Net loss attributable to common stockholders | $ (2,315,254) | $ (2,476,330) |
Weighted average number of common shares and equivalents: | 69,870,040 | 59,196,652 |
Basic EPS | $ (0.03) | $ (0.04) |
Diluted EPS | $ (0.03) | $ (0.04) |
Inventories - Schedule of Inven
Inventories - Schedule of Inventories (Details) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 3,820,618 | $ 3,063,532 |
Work in process | 454,135 | 515,262 |
Finished goods | 2,784,171 | 2,164,187 |
Reserve for obsolescence | (3,888,784) | (3,895,451) |
Total inventory | $ 3,170,140 | $ 1,847,530 |
Prepaid Expenses and Other As_3
Prepaid Expenses and Other Assets - Schedule of Prepaid Expenses and Other Assets (Details) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid expenses | $ 422,061 | $ 640,252 |
Prepaid commissions | 307,339 | 336,594 |
Deposits | 857,777 | 712,179 |
Total prepaid expenses and other assets | 1,587,177 | 1,689,025 |
Less: Noncurrent prepaid expenses and other assets | (196,674) | (218,103) |
Total current prepaid expenses and other assets | $ 1,390,503 | $ 1,470,922 |
Property and Equipment - Schedu
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Gross property and equipment | $ 8,824,314 | $ 8,824,314 |
Less: Accumulated depreciation | (8,603,990) | (8,573,871) |
Net property and equipment | 220,324 | 250,443 |
Equipment [Member] | ||
Gross property and equipment | 6,485,873 | 6,485,873 |
Leasehold Improvements [Member] | ||
Gross property and equipment | $ 2,338,441 | $ 2,338,441 |
Leases (Details Narrative)
Leases (Details Narrative) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 | Jan. 02, 2019 |
Operating Leased Assets [Line Items] | |||
Weighted average discount rate for operating leases | 9.00% | ||
Weighted average remaining lease term for operating lease term | 1 year 9 months | ||
Right of use assets | $ 3,790,044 | $ 4,286,064 | |
Undiscounted future cash flows to be received under the sublease 2020 | 700,000 | ||
Undiscounted future cash flows to be received under the sublease 2021 | $ 1,000,000 | ||
Accounting Standards Update 2016-02 [Member] | |||
Operating Leased Assets [Line Items] | |||
Right of use assets | $ 6,200,000 |
Leases - Schedule of Lease Cost
Leases - Schedule of Lease Costs and Other Lease Information (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Leases [Abstract] | ||
Operating lease cost | $ 585,586 | $ 585,586 |
Short-term lease cost | 15,470 | 19,809 |
Sublease income | (246,530) | (241,065) |
Total lease cost | 354,526 | 364,330 |
Cash paid within operating cash flows | $ 636,350 | $ 615,266 |
Leases - Schedule of Future Min
Leases - Schedule of Future Minimum Operating Lease Payments (Details) | Mar. 31, 2020USD ($) |
Leases [Abstract] | |
2020 | $ 1,754,379 |
2021 | 2,382,661 |
2022 and thereafter | |
Total lease payments | 4,137,040 |
Less: Interest | (295,237) |
Present value of lease liabilities | $ 3,841,803 |
Accrued Liabilities - Schedule
Accrued Liabilities - Schedule of Accrued Liabilities (Details) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Payables and Accruals [Abstract] | ||
Accrued salaries, bonus, and benefits | $ 1,055,345 | $ 1,421,150 |
Accrued licenses and maintenance fees | 483,879 | 483,879 |
Accrued warranties | 133,433 | 141,697 |
Accrued taxes | 169,654 | 206,232 |
Accrued professional services | 415,342 | 383,342 |
Other | 340,061 | 340,321 |
Total accrued liabilities | 2,597,714 | 2,976,621 |
Less: Long term accrued liabilities | (255,517) | (255,517) |
Total current accrued liabilities | $ 2,342,197 | $ 2,721,104 |
Long-Term Debt and Credit Fac_2
Long-Term Debt and Credit Facilities (Details Narrative) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Debt Instrument [Line Items] | ||
Cash and cash equivalents | $ 28,024,723 | $ 30,182,115 |
Revolving Credit Facility [Member] | ||
Debt Instrument [Line Items] | ||
Line of credit facility, current borrowing capacity | 3,400,000 | |
Total liquidity | 31,400,000 | |
Cash and cash equivalents | 28,000,000 | |
Revolving Credit Facility [Member] | Primary Lender [Member] | ||
Debt Instrument [Line Items] | ||
Line of credit facility, maximum borrowing capacity | $ 5,000,000 | |
Revolving Credit Facility [Member] | Primary Lender [Member] | ||
Debt Instrument [Line Items] | ||
Line of credit maturity date | Jun. 30, 2020 | |
Revolving Credit Facility [Member] | Primary Lender [Member] | Prime Rate [Member] | ||
Debt Instrument [Line Items] | ||
Line of credit interest rate | 4.50% |
Convertible Preferred Stock a_3
Convertible Preferred Stock and Stockholders' Equity (Details Narrative) | Aug. 07, 2019USD ($)$ / sharesshares | Sep. 30, 2016$ / sharesshares | Mar. 31, 2020USD ($)Integer$ / sharesshares | Dec. 31, 2019$ / shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of stockholders votes | Integer | 1 | |||
Dividends declared | $ | ||||
Dividends paid | $ | ||||
Common stock, par value | $ 0.001 | $ 0.001 | ||
Preferred stock, par or stated value | 0.001 | $ 0.001 | ||
Exercise price of warrants | $ 0.70 | |||
Warrants exercisable date | Sep. 29, 2021 | |||
Remaining shares available for issuance | shares | 2,192,829 | |||
Total compensation cost not yet recognized | $ | $ 4,300,000 | |||
Weighted average amortization period of total compensation cost not yet recognized | 4 years | |||
Series A Convertible Preferred Stock [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Preferred stock, par or stated value | $ 1,000 | |||
Number of preferred stock issued | shares | 24,000 | |||
Preferred stock, par value | $ 0.001 | |||
Preferred stock, conversion price | $ 0.65 | |||
Common stock issuable from warrants | shares | 36,923,078 | |||
Preferred stock dividend rate | 6.00% | |||
Preferred stock redemption, triggering event, percent of common stock sold threshold | 50.00% | |||
Private Placement [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Net proceeds received | $ | $ 23,100,000 | |||
Private Placement [Member] | Common Stock [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Sale of stock, number of shares sold | shares | 6,585,000 | |||
Common stock, par value | $ 0.001 | |||
Sale of stock, price per share | $ 2.05 | |||
Private Placement [Member] | Series B Convertible Preferred Stock [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Sale of stock, number of shares sold | shares | 5,610,121 | |||
Preferred stock, par or stated value | $ 0.001 | |||
Conversion price per share | $ 2.05 |
Convertible Preferred Stock a_4
Convertible Preferred Stock and Stockholders' Equity - Summary of Option and Stock Appreciation Rights Activity (Details) | 3 Months Ended |
Mar. 31, 2020$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Options/SARs, Outstanding, Beginning Balance | shares | 1,857,599 |
Number of Options/SARs, Granted | shares | 887,250 |
Number of Options/SARs, Exercised | shares | (10,046) |
Number of Options/SARs, Forfeited | shares | (73,801) |
Number of Options/SARs, Outstanding, Ending Balance | shares | 2,661,002 |
Weighted Average Exercise Price per Share, Outstanding, Beginning Balance | $ 2.22 |
Weighted Average Exercise Price per Share, Granted | 4.51 |
Weighted Average Exercise Price per Share, Exercised | 1.19 |
Weighted Average Exercise Price per Share, Forfeited | 2.75 |
Weighted Average Exercise Price per Share, Outstanding, Ending Balance | 2.97 |
Range One [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Range of Exercise Price, Lower Limit | 0.74 |
Range of Exercise Price, Upper Limit | 36.20 |
Range Two [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Range of Exercise Price, Lower Limit | 3.98 |
Range of Exercise Price, Upper Limit | 4.52 |
Range Three [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Range of Exercise Price, Lower Limit | 0.74 |
Range of Exercise Price, Upper Limit | 2.03 |
Range Four [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Range of Exercise Price, Lower Limit | 0.74 |
Range of Exercise Price, Upper Limit | 4.04 |
Range Five [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Range of Exercise Price, Lower Limit | 0.74 |
Range of Exercise Price, Upper Limit | $ 36.20 |
Convertible Preferred Stock a_5
Convertible Preferred Stock and Stockholders' Equity - Summary of Restricted Stock Unit Activity (Details) - Restricted Stock Units [Member] | 3 Months Ended |
Mar. 31, 2020$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Restricted Stock Units, Outstanding, Beginning | shares | 840,712 |
Number of Restricted Stock Units, Granted | shares | 210,000 |
Number of Restricted Stock Units, Vested | shares | (109,489) |
Number of Restricted Stock Units, Forfeited | shares | (250) |
Number of Restricted Stock Units, Outstanding, Ending | shares | 940,973 |
Weighted Average Grant Date Fair Value Per Unit, Outstanding, Beginning | $ / shares | $ 1.28 |
Weighted Average Grant Date Fair Value Per Unit, Granted | $ / shares | 5.24 |
Weighted Average Grant Date Fair Value Per Unit, Vested | $ / shares | 2 |
Weighted Average Grant Date Fair Value Per Unit, Forfeited | $ / shares | 0.78 |
Weighted Average Grant Date Fair Value Per Unit, Outstanding, Ending | $ / shares | $ 2.08 |
Product Warranty Provisions (De
Product Warranty Provisions (Details Narrative) | 3 Months Ended |
Mar. 31, 2020 | |
Product Warranties Disclosures [Abstract] | |
Standard product warranty coverage term | 1 year |
Product Warranty Provisions - S
Product Warranty Provisions - Schedule of Accrued Warranty (Details) - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2020 | Dec. 31, 2019 | |
Product Warranties Disclosures [Abstract] | ||
Warranty accrual, beginning of the fiscal period | $ 141,697 | $ 149,464 |
Accrual adjustment for product warranty | 7,637 | 56,118 |
Payments made | (15,901) | (63,885) |
Warranty accrual, end of the fiscal period | $ 133,433 | $ 141,697 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - Subsequent Event [Member] | Apr. 20, 2020USD ($) |
CARES Act [Member] | |
Loan description | In accordance with the loan forgiveness requirements of the CARES Act, the Company intends to use the proceeds from the PPP Loan primarily for payroll costs, rent and utilities, thus 100% of the loan should be forgiven. |
Paycheck Protection Program [Member] | |
Proceeds from bank | $ 2,158,310 |
Maturity date | Apr. 20, 2022 |
Interest rate | 1.00% |