Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
Sep. 30, 2018 | Nov. 09, 2018 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Entity Registrant Name | XpresSpa Group, Inc. | |
Entity Central Index Key | 1,410,428 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Trading Symbol | XSPA | |
Entity Common Stock, Shares Outstanding | 34,546,518 | |
Entity Emerging Growth Company | false | |
Entity Small Business | true |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Current assets | ||
Cash and cash equivalents | $ 2,525 | $ 6,368 |
Inventory | 802 | 1,159 |
Other current assets | 591 | 2,120 |
Assets held for disposal | 109 | 6,446 |
Total current assets | 4,027 | 16,093 |
Restricted cash | 487 | 487 |
Property and equipment, net | 15,005 | 15,797 |
Intangible assets, net | 9,789 | 11,547 |
Goodwill | 0 | 19,630 |
Other assets | 3,356 | 1,686 |
Total assets | 32,664 | 65,240 |
Current liabilities | ||
Accounts payable, accrued expenses and other current liabilities | 7,641 | 8,736 |
Convertible notes, net | 1,610 | 0 |
Liabilities held for disposal | 40 | 3,761 |
Total current liabilities | 9,291 | 12,497 |
Debt | 6,500 | 6,500 |
Convertible notes, net | 398 | 0 |
Derivative warrant liabilities | 455 | 34 |
Other liabilities | 265 | 370 |
Total liabilities | 16,909 | 19,401 |
Commitments and contingencies (see Note 13) | ||
Stockholders' equity | ||
Common stock, $0.01 par value per share; 150,000,000 shares authorized; 31,919,511 and 26,545,690 issued and outstanding as of September 30, 2018 and December 31, 2017, respectively | 319 | 265 |
Additional paid-in capital | 291,989 | 290,396 |
Accumulated deficit | (280,351) | (249,708) |
Accumulated other comprehensive loss | (279) | (74) |
Total stockholders' equity attributable to the Company | 11,682 | 40,883 |
Noncontrolling interests | 4,073 | 4,956 |
Total stockholders' equity | 15,755 | 45,839 |
Total liabilities and stockholders' equity | 32,664 | 65,240 |
Series A Convertible Preferred Stock [Member] | ||
Stockholders' equity | ||
Preferred stock | 0 | 0 |
Series B Convertible Preferred Stock [Member] | ||
Stockholders' equity | ||
Preferred stock | 0 | 0 |
Series C Junior Preferred Stock [Member] | ||
Stockholders' equity | ||
Preferred stock | 0 | 0 |
Series D Convertible Preferred Stock [Member] | ||
Stockholders' equity | ||
Preferred stock | $ 4 | $ 4 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, authorized | 150,000,000 | 150,000,000 |
Common stock, issued | 31,919,511 | 26,545,690 |
Common stock, outstanding | 31,919,511 | 26,545,690 |
Series A Convertible Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, authorized | 6,968 | 6,968 |
Preferred stock, issued | 6,968 | 6,968 |
Preferred stock, outstanding | 0 | 0 |
Series B Convertible Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, authorized | 1,609,167 | 1,609,167 |
Preferred stock, issued | 1,609,167 | 1,609,167 |
Preferred stock, outstanding | 0 | 0 |
Series C Junior Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, authorized | 300,000 | 300,000 |
Preferred stock, issued | 0 | 0 |
Preferred stock, outstanding | 0 | 0 |
Series D Convertible Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, authorized | 500,000 | 500,000 |
Preferred stock, issued | 475,208 | 475,208 |
Preferred stock, outstanding | 420,541 | 420,541 |
Preferred Stock, Liquidation Preference, Value | $ 20,186 | $ 20,186 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Revenue | ||||
Products and services | $ 12,922 | $ 12,652 | $ 37,760 | $ 36,563 |
Other | 0 | 200 | 800 | 300 |
Total revenue | 12,922 | 12,852 | 38,560 | 36,863 |
Cost of sales | ||||
Labor | 5,997 | 7,086 | 18,697 | 18,178 |
Occupancy | 1,996 | 1,950 | 6,216 | 5,704 |
Products and other operating costs | 1,992 | 1,437 | 5,208 | 6,044 |
Total cost of sales | 9,985 | 10,473 | 30,121 | 29,926 |
Depreciation and amortization | 1,879 | 1,722 | 5,375 | 6,379 |
Goodwill impairment | 0 | 0 | 19,630 | 0 |
General and administrative | 3,943 | 4,180 | 12,443 | 13,037 |
Total operating expenses | 15,807 | 16,375 | 67,569 | 49,342 |
Operating loss from continuing operations | (2,885) | (3,523) | (29,009) | (12,479) |
Interest expense | (624) | (183) | (1,212) | (549) |
Other non-operating income (expense), net | 378 | (82) | 877 | (17) |
Loss from continuing operations before income taxes | (3,131) | (3,788) | (29,344) | (13,045) |
Income tax benefit (expense) | 66 | (57) | 198 | (284) |
Consolidated net loss from continuing operations | (3,065) | (3,845) | (29,146) | (13,329) |
Loss from discontinued operations before income taxes | 0 | (699) | (1,115) | (4,474) |
Income tax benefit (expense) | 0 | 0 | 0 | 0 |
Consolidated net loss from discontinued operations | 0 | (699) | (1,115) | (4,474) |
Consolidated net loss | (3,065) | (4,544) | (30,261) | (17,803) |
Net income attributable to noncontrolling interests | (122) | (153) | (382) | (329) |
Net loss attributable to the Company | (3,187) | (4,697) | (30,643) | (18,132) |
Comprehensive loss | $ (3,068) | $ (4,513) | $ (30,466) | $ (17,923) |
Loss per share | ||||
Loss per share from continuing operations (in dollars per share) | $ (0.11) | $ (0.16) | $ (1.08) | $ (0.65) |
Loss per share from discontinued operations (in dollars per share) | 0 | (0.04) | (0.04) | (0.22) |
Total basic and diluted net loss per share (in dollars per share) | $ (0.11) | $ (0.20) | $ (1.12) | $ (0.87) |
Weighted-average number of shares outstanding during the period: | ||||
Basic (in shares) | 28,352,284 | 24,144,002 | 27,268,792 | 20,852,034 |
Diluted (in shares) | 28,352,284 | 24,144,002 | 27,268,792 | 20,852,034 |
Includes stock-based compensation expense, as follows: | ||||
Total stock-based compensation expense | $ 194 | $ 706 | $ 765 | $ 2,179 |
General and Administrative [Member] | ||||
Includes stock-based compensation expense, as follows: | ||||
Total stock-based compensation expense | 194 | 662 | 765 | 1,752 |
Continuing Operations [Member] | ||||
Cost of sales | ||||
Consolidated net loss from continuing operations | (3,065) | (3,845) | (29,146) | (13,329) |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | (3) | 31 | (205) | (120) |
Comprehensive loss | (3,068) | (3,814) | (29,351) | (13,449) |
Discontinued Operations [Member] | ||||
Cost of sales | ||||
Consolidated net loss from discontinued operations | 0 | (699) | (1,115) | (4,474) |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | 0 | 0 | 0 | 0 |
Comprehensive loss | 0 | (699) | (1,115) | (4,474) |
Includes stock-based compensation expense, as follows: | ||||
Total stock-based compensation expense | $ 0 | $ 44 | $ 0 | $ 427 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Preferred stock [Member] | Common stock [Member] | Additional paid-in capital [Member] | Accumulated deficit [Member] | Accumulated other comprehensive loss [Member] | Total Company equity [Member] | Non-controlling Interests [Member] |
Balance at Dec. 31, 2016 | $ 64,169 | $ 5 | $ 183 | $ 280,221 | $ (220,868) | $ (13) | $ 59,528 | $ 4,641 |
Issuance of common stock for services | 20 | 0 | 0 | 20 | 0 | 0 | 20 | 0 |
Issuance of common stock for acquisition of Excalibur | 1,809 | 0 | 9 | 1,800 | 0 | 0 | 1,809 | 0 |
Net proceeds from sale and issuance of shares of common stock in public offering | 6,584 | 0 | 69 | 6,515 | 0 | 0 | 6,584 | 0 |
Decrease in shares of preferred stock issued to XpresSpa sellers | (908) | 0 | 0 | (908) | 0 | 0 | (908) | 0 |
Conversion of preferred stock to common stock | (1) | (1) | 4 | (4) | 0 | 0 | (1) | 0 |
Stock-based compensation | 2,179 | 0 | 0 | 2,179 | 0 | 0 | 2,179 | 0 |
Net loss for the period | (17,803) | 0 | 0 | 0 | (18,132) | 0 | (18,132) | 329 |
Foreign currency translation | (120) | 0 | 0 | 0 | 0 | (120) | (120) | 0 |
Contributions from noncontrolling interests | 272 | 0 | 0 | 0 | 0 | 0 | 0 | 272 |
Distributions to noncontrolling interests | (365) | 0 | 0 | 0 | 0 | 0 | 0 | (365) |
Balance at Sep. 30, 2017 | 55,836 | 4 | 265 | 289,823 | (239,000) | (133) | 50,959 | 4,877 |
Balance at Dec. 31, 2017 | 45,839 | 4 | 265 | 290,396 | (249,708) | (74) | 40,883 | 4,956 |
Vesting of restricted stock units ("RSUs") | 0 | 0 | 6 | (6) | 0 | 0 | 0 | 0 |
Issuance of equity warrants | 64 | 0 | 0 | 64 | 0 | 0 | 64 | 0 |
Issuance of common stock for repayment of debt and interest | 818 | 0 | 48 | 770 | 0 | 0 | 818 | 0 |
Stock-based compensation | 765 | 0 | 0 | 765 | 0 | 0 | 765 | 0 |
Net loss for the period | (30,261) | 0 | 0 | 0 | (30,643) | 0 | (30,643) | 382 |
Foreign currency translation | (205) | 0 | 0 | 0 | 0 | (205) | (205) | 0 |
Contributions from noncontrolling interests | 119 | 0 | 0 | 0 | 0 | 0 | 0 | 119 |
Distributions to noncontrolling interests | (1,384) | 0 | 0 | 0 | 0 | 0 | 0 | (1,384) |
Balance at Sep. 30, 2018 | $ 15,755 | $ 4 | $ 319 | $ 291,989 | $ (280,351) | $ (279) | $ 11,682 | $ 4,073 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Cash flows from operating activities | ||
Consolidated net loss | $ (30,261) | $ (17,803) |
Consolidated net loss from discontinued operations | (1,115) | (4,474) |
Consolidated net loss from continuing operations | (29,146) | (13,329) |
Items not affecting cash flows | ||
Depreciation and amortization | 5,375 | 6,379 |
Goodwill impairment | 19,630 | 0 |
Stock-based compensation | 765 | 1,752 |
Issuance of shares of common stock | 0 | 1,829 |
Issuance of shares of common stock for repayment of debt and interest | 169 | 0 |
Issuance of equity warrants | 64 | 0 |
Gain on disposal of asset | 0 | (148) |
Amortization of debt discount and debt issuance costs | 589 | 0 |
Conversion of shares of preferred stock to shares of common stock | 0 | (1) |
Contingent liability assumed from acquisition | 0 | (316) |
Gain on the sale of patents | (450) | 0 |
Changes in assets and liabilities | ||
Decrease in inventory | 357 | 967 |
Decrease (increase) in other current assets and other assets | (741) | 1,229 |
Decrease in accounts payable, accrued expenses and other current liabilities | (1,095) | (4,189) |
Increase in other liabilities | (105) | 791 |
Net cash used in operating activities – continuing operations | (6,129) | (5,243) |
Net cash provided by (used in) operating activities - discontinued operations | 1,501 | (5,716) |
Net cash used in operating activities | (4,628) | (10,959) |
Cash flows from investing activities | ||
Acquisition of property and equipment | (2,682) | (1,970) |
Acquisition of software | (143) | (331) |
Proceeds from the sale of patents | 250 | 150 |
Cash received from note receivable | 800 | 0 |
Net cash used in investing activities – continuing operations | (1,775) | (2,151) |
Net cash used in investing activities – discontinued operations | 0 | (738) |
Net cash used in investing activities | (1,775) | (2,889) |
Cash flows provided by (used in) financing activities | ||
Proceeds from convertible notes and warrants | 4,350 | 0 |
Debt issuance costs | (320) | 0 |
Net proceeds from sale and issuance of shares of common stock in public offering | 0 | 6,584 |
Contributions from noncontrolling interests | 119 | 272 |
Distributions to noncontrolling interests | (1,384) | (365) |
Net cash provided by (used in) financing activities – continuing operations | 2,765 | 6,491 |
Net cash used in financing activities – discontinued operations | 0 | (361) |
Net cash provided by (used in) financing activities | 2,765 | 6,130 |
Effect of exchange rate changes and foreign currency translation | (205) | (120) |
Decrease in cash and cash equivalents | (3,843) | (7,838) |
Cash and cash equivalents at beginning of period | 6,368 | 17,910 |
Cash and cash equivalents at end of period | 2,525 | 10,072 |
Cash paid during the period for | ||
Interest | 580 | 580 |
Non-cash investing and financing transactions | ||
Non-cash acquisition of cost method investment | 2,075 | 0 |
Debt discount related to issuance of convertible notes | 1,962 | 0 |
Issuance of common stock to repay $649 of debt and interest | 818 | 0 |
Change in fair value of derivative warrant liabilities - May 2015 [Member] | ||
Items not affecting cash flows | ||
Change in fair value of derivative warrant liabilities | (33) | (207) |
Change in fair value of derivative warrant liabilities - May 2018 [Member] | ||
Items not affecting cash flows | ||
Change in fair value of derivative warrant liabilities | $ (1,508) | $ 0 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 4 Months Ended |
Sep. 30, 2018 | Sep. 30, 2018 | |
Repayments of Debt | $ 649 | $ 649 |
General
General | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
General | Note 1. General On January 5, 2018, FORM Holdings Corp. changed its name to XpresSpa Group, Inc. (“XpresSpa Group” or the “Company”). The Company’s common stock, par value $0.01 per share, which had previously been listed under the trading symbol “FH” on the Nasdaq Capital Market (“Nasdaq”), has been listed under the trading symbol “XSPA” since January 8, 2018. Rebranding to XpresSpa Group aligned the Company’s corporate strategy to build a pure-play health and wellness services company, which the Company commenced following its acquisition of XpresSpa Holdings, LLC (“XpresSpa”) on December 23, 2016. As a result of the transition to a pure-play health and wellness services company, the Company currently has one operating segment that is also its sole reporting unit, XpresSpa, a leading airport retailer of spa services. XpresSpa is a well-recognized airport spa brand with 57 locations, consisting of 52 domestic and 5 international locations as of September 30, 2018. XpresSpa offers travelers premium spa services, including massage, nail and skin care, as well as spa and travel products. In October 2017, the Company completed the sale of FLI Charge, Inc. (“FLI Charge”) and, in March 2018, the Company completed the sale of Group Mobile Int’l LLC (“Group Mobile”). These two entities formerly comprised the Company’s technology operating segment, which was discontinued following the disposition of Group Mobile. The results of operations for FLI Charge and Group Mobile are presented in the condensed consolidated statements of operations and comprehensive loss as consolidated net loss from discontinued operations. The carrying amounts of assets and liabilities belonging to Group Mobile are presented in the condensed consolidated balance sheets as assets held for disposal and liabilities held for disposal, respectively, as of September 30, 2018 and December 31, 2017. The Company owns certain patent portfolios, which it looks to monetize through sales and licensing agreements. During the nine-month period ended September 30, 2018, the Company determined that its former intellectual property operating segment would no longer be an area of focus and, as such, will no longer operate as a separate operating segment, as it is not expected to generate any material revenues or operating costs. On May 15, 2018, the Company entered into a securities purchase agreement (the “Securities Purchase Agreement”) with certain institutional investors (the “Investors”), pursuant to which the Company agreed to sell up to (i) an aggregate principal amount of $4,438 in 5% Secured Convertible Notes due November 16, 2019, which included $88 issued to Palladium Capital Advisors as Placement Agent (the “Convertible Notes”), convertible into shares of the Company’s common stock, par value $0.01 per share (the “Common Stock”) at a conversion price of $0.62 per share, (ii) Class A Warrants (the “Class A Warrants”) to purchase 7,157,259 shares of Common Stock at an exercise price of $0.62 per share and (iii) Class B Warrants (the “Class B Warrants,” and together with the Class A Warrants, the “Warrants”) to purchase 3,578,630 shares of Common Stock at an exercise price of $0.62 per share. The Convertible Notes bear interest at a rate of 5% per annum. The Convertible Notes are senior secured obligations of the Company and are secured by certain of its personal property. Unless earlier converted or redeemed, the Convertible Notes will mature on November 16, 2019. The transaction closed on May 17, 2018, at which time the Company received $4,350 in gross proceeds from the Investors. On August 14, 2018, the Company and each of the Investors entered into an Amendment Agreement (“Amendment Agreement”) whereby the initial monthly principal repayment and accrued interest due on the Convertible Notes of $351 was settled in 2,067 shares of Common Stock on August 15, 2018. All other material terms of the Securities Purchase Agreement remained unchanged. During the three-month period ended September 30, 2018, several of the Investors converted their monthly principal payments and accrued interest due on the Convertible Notes into shares of Common Stock pursuant to the Amendment Agreement, resulting in the issuance of an additional 2,737 shares of Common Stock. As of September 30, 2018, the Company’s current assets were $4,027, which included cash and cash equivalents of $2,525. The Company’s current liabilities were $9,291 as of September 30, 2018, which included $1,610 of convertible notes classified as short-term for which principal repayments may be made in Common Stock at the Company’s election. In addition, included in total current liabilities is approximately $1,661 which relates to obligations that will not settle in cash, and an additional $465 of liabilities that are not expected to settle in the next twelve months. On November 12, 2018, the Company entered into a Product Sale and Marketing Agreement (the “Collaboration Agreement”) with Calm.com, Inc. (“Calm”) primarily related to the display, marketing, promotion, offer for sale and sale of Calm’s products in each of the Company’s branded stores throughout the United States. The Collaboration Agreement resulted in an initial investment by Calm of $2,000 in Series E Preferred Stock, convertible into shares of Common Stock at $0.62 per share, which was received upon the closing of the transaction. The Company’s management believes that its current cash balance, cash provided from the Calm Collaboration Agreement, cash to be provided by future operating activities, and cash proceeds from the anticipated liquidation of certain investments, will be sufficient to fund its planned operations and pay its liabilities as they become due for at least the next twelve months following the filing date of these financial statements. At the Company’s election, principal repayments of the Convertible Notes may be made in cash or, subject to certain conditions, in registered shares of Common Stock. In addition, the Company has access to additional sources of financing and may attempt to renegotiate terms of various contracts. |
Accounting and Reporting Polici
Accounting and Reporting Policies | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Accounting and Reporting Policies | Note 2. Accounting and Reporting Policies (a) Basis of presentation and principles of consolidation The accompanying interim condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information and the instructions to Rule 10-01 of Regulation S-X, and should be read in conjunction with the Company's Annual Report on Form 10-K for the year ended December 31, 2017. The condensed consolidated financial statements include the accounts of the Company, all entities that are wholly-owned by the Company, and all entities in which the Company has a controlling financial interest. All adjustments that, in the opinion of management, are necessary for a fair presentation for the periods presented have been reflected by the Company. Such adjustments are of a normal, recurring nature. The results of operations for the three- and nine-month periods ended September 30, 2018 are not necessarily indicative of the results that may be expected for the entire fiscal year or for any other interim period. All significant intercompany balances and transactions have been eliminated in consolidation. (b) Use of estimates The preparation of the accompanying condensed consolidated financial statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses for the periods presented. Actual results may differ from such estimates. Significant items subject to such estimates and assumptions include the Company’s intangible assets, investments classified as other assets, the useful lives of the Company’s intangible assets, the valuation of the Company’s derivative warrant liabilities, the valuation of stock-based compensation, deferred tax assets and liabilities, income tax uncertainties, and other contingencies. (c) Cash and cash equivalents The Company maintains cash in checking accounts with financial institutions. The Company has established guidelines relating to diversification and maturities of its investments in order to minimize credit risk and maintain high liquidity of funds. Cash equivalents include amounts due from third-party financial institutions for credit and debit card transactions. These items typically settle in less than five days. As of September 30, 2018, the Company held significant portions of its cash balance in overseas accounts, totaling $1,081, which is not insured by the Federal Deposit Insurance Corporation (“FDIC”). If the Company were to distribute the amounts held overseas, the Company would need to follow an approval process as defined in its operating and partnership agreements, which may delay the availability of cash to the Company. (d) Revenue recognition The Company recognizes revenue from the sale of XpresSpa products and services at the point of sale, net of discounts and applicable sales taxes. Revenues from the XpresSpa wholesale and e-commerce businesses are recorded at the time goods are shipped. The Company excludes all sales taxes assessed to its customers. Sales taxes assessed on revenues are included in accounts payable, accrued expenses and other current liabilities in the condensed consolidated balance sheets until remitted to the state agencies. Other revenue relates to one-time intellectual property licenses as well as the sale of certain of the Company’s intellectual property. Revenue from patent licensing is recognized when the Company transfers promised intellectual property rights to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those intellectual property rights. Currently, revenue arrangements related to intellectual property provide for the payment of contractually determined fees and other consideration for the grant of certain intellectual property rights related to the Company’s patents. These rights typically include some combination of the following: (i) the grant of a non-exclusive, retroactive and future license to manufacture and/or sell products covered by patents, (ii) the release of the licensee from certain claims, and (iii) the dismissal of any pending litigation. The intellectual property rights granted typically extend until the expiration of the related patents. Pursuant to the terms of these agreements, the Company has no further obligation with respect to the grant of the non-exclusive retroactive and future licenses, covenants-not-to-sue, releases, and other deliverables, including no express or implied obligation on the Company’s part to maintain or upgrade the related technology, or provide future support or services. Generally, the agreements provide for the grant of the licenses, covenants-not-to-sue, releases, and other significant deliverables upon execution of the agreement, or upon receipt of the upfront payment. As such, the earnings process is complete and revenue is recognized upon the execution of the agreement, receipt of the upfront fee, and transfer of the promised intellectual property rights. (e) Cost of sales Cost of sales consists of store-level costs. Store-level costs include all costs that are directly attributable to the store operations and include: • payroll and related benefits for store operations and store-level management; • rent, percentage rent and occupancy costs; • the cost of merchandise; • freight, shipping and handling costs; • production costs; • inventory shortage and valuation adjustments, including purchase price allocation increase in fair values which was recorded as part of acquisition; and • costs associated with sourcing operations. Cost of sales related to the Company’s intellectual property mainly includes expenses incurred in connection with the Company’s patent licensing and enforcement activities, patent-related legal expenses paid to external patent counsel (including contingent legal fees), licensing and enforcement related research, consulting and other expenses paid to third parties, as well as related internal payroll expenses. (f) Investments The Company accounts for its investments in other entities using the cost method of accounting when the Company has no substantial influence over, and the investment is less than 20% of, the investee entity. Under the cost method, the investment is recorded at cost, which approximates fair value, on the date of acquisition. The Company performs an assessment for impairment on at least an annual basis, or when there is an indication that cost exceeds fair value. (g) Fair value measurements The Company measures fair value in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 820-10, Fair Value Measurements and Disclosures clarifies that fair value is an exit price, representing the amount that would be received by selling an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. As a basis for considering such assumptions, FASB ASC 820-10 establishes a three-tier value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: Level 1 : Unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date. Level 2 : Other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability. Level 3 : Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at measurement date. The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. (h) Recently issued accounting pronouncements Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606) The core principle of this new standard is that revenue should be recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This guidance was amended in July 2015 and is effective for annual reporting periods beginning after December 15, 2017. Adoption of this ASU did not have a material impact on the Company’s condensed consolidated financial statements. ASU No. 2016-01, Financial Instruments – Overall (Topic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities This standard amends various aspects of the recognition, measurement, presentation, and disclosure for financial instruments. With respect to the Company’s condensed consolidated financial statements, the most significant impact relates to the accounting for equity investments. It will impact the disclosure and presentation of financial assets and liabilities. The amendments in this update are effective for annual reporting periods, and interim periods within those years beginning after December 15, 2017. Adoption of this ASU did not have a material impact on the Company’s condensed consolidated financial statements. ASU No. 2016-02, Leases (Topic 842) This standard provides new guidance related to accounting for leases and supersedes GAAP on lease accounting with the intent to increase transparency. This standard requires operating leases to be recorded on the balance sheet as assets and liabilities and requires disclosure of key information about leasing arrangements. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the statement of operations and comprehensive loss. The adoption will require a modified retrospective approach as of the beginning of the earliest period presented. The new standard is effective for the fiscal year beginning after December 15, 2018, with early adoption permitted. The Company is currently in the process of evaluating the impact of the adoption on its condensed consolidated financial statements, and expects that it will result in a significant increase in its long-term assets and liabilities. ASU No. 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment This standard provides new guidance to eliminate the requirement to calculate the implied fair value of goodwill, or the Step 2 test, to measure a goodwill impairment charge. Instead, entities will record an impairment charge based on the excess of a reporting unit’s carrying amount over its fair value. The loss recognized should not exceed the total goodwill allocated to the reporting unit. The new standard is effective for the fiscal year beginning after December 15, 2019, with early adoption permitted. The Company early adopted this standard effective January 1, 2018. Adoption of this ASU did not have a material impact on the Company’s condensed consolidated financial statements. ASU No. 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815) This standard provides new guidance to address the complexity of accounting for certain financial instruments with down round features. The amendments of this ASU change the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. A down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. A freestanding equity-linked financial instrument (or embedded conversion feature) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. The new standard is effective for the fiscal year beginning after December 15, 2018 with early adoption permitted. The Company early adopted this standard effective January 1, 2018. Adoption of this ASU did not have a material impact on the Company’s condensed consolidated financial statements. ASU No. 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income This standard provides guidance on the reclassification of certain tax effects from accumulated other comprehensive income to retained earnings in the period in which the effects of the change in the United States federal corporate income tax rate in the Tax Cuts and Jobs Act is recorded. The new standard is effective for the fiscal year beginning after December 15, 2018. The Company is currently in the process of evaluating the impact of the adoption of this standard on its condensed consolidated financial statements. ASU No. 2018-11, Leases (Topic 842): Targeted Improvements This standard provides an optional transition method to adopt the new leases standard in Topic 842 which permits the recognition of a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. The amendments do not change the existing disclosure requirements in Topic 840. The new standard is effective for the fiscal year beginning after December 15, 2018. The Company is currently in the process of evaluating the impact of the adoption on its condensed consolidated financial statements, and expects that it will result in an adjustment to the opening balance of retained earnings in the period of adoption. ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement This amendment provides updates to the disclosure requirements on fair value measures in Topic 820 which includes the changes in unrealized gains and losses in other comprehensive income for recurring Level 3 fair value measurements, the option of additional quantitative information surrounding unobservable inputs and the elimination of disclosures around the valuation processes for Level 3 measurements. The new standard is effective for the fiscal year beginning after December 15, 2019. The Company is currently in the process of evaluating the impact of the adoption of this standard on its condensed consolidated financial statements. (i) Reclassification Certain balances have been reclassified to conform to presentation requirements, including the presentation of discontinued operations and the consistent presentation of the allocation of cost of sales and general and administrative expenses between store locations and corporate in the condensed consolidated statements of operations and comprehensive loss. |
Net Loss per Share of Common St
Net Loss per Share of Common Stock | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share, Basic and Diluted [Abstract] | |
Net Loss per Common Share | Note 3. Net Loss per Share of Common Stock The table below presents the computation of basic and diluted net loss per share of Common Stock: Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 Basic and diluted numerator: Net loss from continuing operations attributable to shares of common stock $ (3,187 ) $ (3,998 ) $ (29,528 ) $ (13,658 ) Net loss from discontinued operations attributable to shares of common stock - (699 ) (1,115 ) (4,474 ) Net loss attributable to the Company $ (3,187 ) $ (4,697 ) $ (30,643 ) $ (18,132 ) Basic and diluted denominator: Basic shares of common stock outstanding 28,352,284 24,144,002 27,268,792 20,852,034 Basic loss per share of common stock from continuing operations $ (0.11 ) $ (0.16 ) $ (1.08 ) $ (0.65 ) Basic loss per share of common stock from discontinued operations - (0.04 ) (0.04 ) (0.22 ) Basic and diluted net loss per share of common stock $ (0.11 ) $ (0.20 ) $ (1.12 ) $ (0.87 ) Net loss per share data presented excludes from the calculation of diluted net loss the following potentially dilutive securities, as they had an anti-dilutive impact: Both vested and unvested options to purchase an equal number of shares of common stock of the Company 2,285,000 4,876,899 2,285,000 4,876,899 Unvested RSUs to issue an equal number of shares of common stock of the Company 455,000 365,565 455,000 365,565 Warrants to purchase an equal number of shares of common stock of the Company 14,073,390 3,087,500 14,073,390 3,087,500 Preferred stock on an as converted basis 3,364,328 3,439,587 3,364,328 3,620,626 Convertible notes on an as converted basis 4,350,000 — 4,350,000 — Total number of potentially dilutive instruments, excluded from the calculation of net loss per share 24,527,718 11,769,551 24,527,718 11,950,590 |
Goodwill
Goodwill | 9 Months Ended |
Sep. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill | Note 4. Goodwill On January 5, 2018, the Company changed its name to XpresSpa Group as part of a rebranding effort to carry out its corporate strategy to build a pure-play health and wellness services company, which the Company commenced following its acquisition of XpresSpa on December 23, 2016. The Company completed the sale of Group Mobile on March 22, 2018, which was the only remaining component of the Company’s technology operating segment. Following the sale of Group Mobile, the Company’s management made the decision that its intellectual property operating segment would no longer be an area of focus and would no longer be a separate operating segment as it is not expected to generate any material revenues. This completed the transition of the Company into a pure-play health and wellness company with only one operating segment, consisting of its XpresSpa business. The Company’s market capitalization is sensitive to the volatility of its stock price. On January 2, 2018, the first trading day of fiscal year 2018, the Company’s stock price opened at $1.36 and closed at $1.45. The closing price of the Company’s stock on March 29, 2018, the last trading day of the first quarter of fiscal 2018, was $0.72. The average closing stock price of the Company from January 2, 2018 through March 29, 2018 was approximately $1.02, ranging from $0.71 to $1.80 during that period. On April 19, 2018, the Company entered into a separation agreement with its Chief Executive Officer regarding his resignation as Chief Executive Officer and as a Director the Company. On that same date, the Company’s Senior Vice President and Chief Executive Officer of XpresSpa was appointed by the Board of Directors as the Chief Executive Officer and as a Director of the Company. These events were identified by the Company’s management as triggering events requiring that goodwill be tested for impairment as of March 31, 2018. In addition to the Company’s rebranding efforts to a pure-play health and wellness services company, its stock price continued to decline even after the announcement of the new Chief Executive Officer. As the stock price had not rebounded, the Company determined that the impairment related to the three-month period ended March 31, 2018. The Company performed a quantitative goodwill impairment test, in which the Company compared the carrying value of the reporting unit to its estimated fair value, which was calculated using an income approach. The key assumptions for this approach were projected future cash flows and a discount rate, which was based on a weighted average cost of capital adjusted for the relevant risk associated with the characteristics of the business and the projected future cash flows. As a result of the quantitative goodwill impairment test performed as of March 31, 2018, the Company determined that the fair value of the reporting unit did not exceed its carrying amount and, therefore, goodwill of the reporting unit was considered impaired. Based on the estimated fair value of goodwill, the Company recorded an impairment charge of $19,630, to reduce the carrying value of goodwill to its fair value, which was determined to be zero. This impairment charge is included in goodwill impairment in the condensed consolidated statements of operations and comprehensive loss for the nine-month period ended September 30, 2018. The fair value measurement of goodwill was classified within Level 3 of the fair value hierarchy because the income approach was used, which utilizes significant inputs that are unobservable in the market. The Company believes it made reasonable estimates and assumptions to calculate the fair value of the reporting unit as of the impairment test measurement date. |
Other Assets
Other Assets | 9 Months Ended |
Sep. 30, 2018 | |
Other Noncurrent Assets [Abstract] | |
Other Assets | Note 5. Other Assets Other assets in the condensed consolidated balance sheets are comprised of the following as of September 30, 2018 and December 31, 2017: September 30, 2018 December 31, 2017 Cost method investments $ 2,502 $ 834 Lease deposits 854 852 Other assets $ 3,356 $ 1,686 As of September 30, 2018, the Company’s other assets included: $1,625 cost method investment in Route1 Inc. (“Route1”), which the Company received from the disposition of Group Mobile in March 2018; $787 cost method investment in InfoMedia Services Limited (“InfoMedia”), which the Company acquired in 2014; $43 cost method investment in Marathon Patent Group, Inc. (“Marathon”), which the Company acquired in January 2018 with an acquisition date fair value of $450. Based on the Company’s evaluation of the investment, it was determined that certain unrealized losses represented an other-than-temporary impairment as of September 30, 2018 and the Company recognized an impairment charge of $26 and $133 for , equal to the excess of carrying value over fair value. During the three-month period ended September 30, 2018, the Company sold 200,046 shares of Marathon common stock, with a carrying value of $274, for net proceeds of $193; $47 cost method investment in FLI Charge, which the Company received from the disposition of FLI Charge in October 2017; and $854 deposits made pursuant to various lease agreements, which will be returned to the Company at the end of the leases. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2018 | |
Segment Reporting [Abstract] | |
Segment Information | Note 6. Segment Information As a result of the Company’s transition to a pure-play health and wellness services company, it currently has one operating segment that is also its sole reporting unit, XpresSpa. The Company currently operates in two geographical segments: the United States and all other countries. The following table represents the geographical revenue and segment operating loss for the three- and nine-month periods ended September 30, 2018 and 2017 and total asset information as of September 30, 2018 and December 31, 2017. There were no concentrations of geographical revenue, segment operating loss or total assets related to any single foreign country that were material to the Company’s condensed consolidated financial statements. Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 Revenue United States $ 11,516 $ 11,349 $ 34,513 $ 32,982 All other countries 1,406 1,503 4,047 3,881 Total revenue 12,922 12,852 38,560 36,863 Cost of sales United States 9,056 9,637 27,524 27,588 All other countries 929 836 2,597 2,338 Total cost of sales 9,985 10,473 30,121 29,926 Segment operating income (loss) United States (3,095 ) (4,052 ) (29,470 ) (13,704 ) All other countries 210 529 461 1,225 Operating loss from continuing operations (2,885 ) (3,523 ) (29,009 ) (12,479 ) Other non-operating expense, net (246 ) (265 ) (335 ) (566 ) Loss from continuing operations before income taxes $ (3,131 ) $ (3,788 ) $ (29,344 ) $ (13,045 ) September 30, 2018 December 31, 2017 Assets United States $ 29,878 $ 55,152 All other countries 2,677 3,642 Assets held for disposal 109 6,446 Total assets $ 32,664 $ 65,240 |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Note 7. Fair Value Measurements Derivative Warrant Liabilities The following table presents the placement in the fair value hierarchy of derivative warrant liabilities measured at fair value on a recurring basis as of September 30, 2018, May 17, 2018 and December 31, 2017: May 2015 Warrants Fair value measurement at reporting date using Balance Quoted prices in active markets for identical assets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) September 30, 2018: $ 1 $ — $ — $ 1 December 31, 2017: $ 34 $ — $ — $ 34 May 2018 Warrants Fair value measurement at reporting date using Quoted prices in active markets Significant other Significant for identical observable unobservable Balance assets (Level 1) inputs (Level 2) inputs (Level 3) September 30,2018: A Warrants $ 455 $ — $ — $ 455 B Warrants — — — — Total $ 455 $ — $ — $ 455 May 17, 2018: A Warrants $ 1,827 $ — $ — $ 1,827 B Warrants 135 — — 135 Total $ 1,962 $ — $ — $ 1,962 The Company measures its derivative warrant liabilities at fair value. The derivative warrant liabilities were classified within Level 3 because they were valued using the Black-Scholes-Merton model, which utilizes significant inputs that are unobservable in the market. These derivative warrant liabilities were initially measured at fair value and are marked to market at each balance sheet date. The derivative warrant liabilities are recorded as derivative warrant liabilities in the condensed consolidated balance sheets and the revaluation of the derivative warrants liabilities is included in other non-operating income (expense) in the condensed consolidated statements of operations and comprehensive loss. In addition to the above, the Company’s financial instruments as of September 30, 2018 and December 31, 2017 consisted of cash and cash equivalents, trade and loan receivables, inventory, accounts payable and other current liabilities. The carrying amounts of all the aforementioned financial instruments approximate fair value because of the short-term maturities of these instruments. The following table summarizes the changes in the Company’s derivative warrant liabilities measured at fair value using significant unobservable inputs (Level 3) during the three- and nine-month periods ended September 30, 2018: December 31, 2017 $ 34 Issuance of warrants May 17, 2018 1,962 Decrease in fair value of the derivative warrant liabilities (1,541 ) September 30, 2018 $ 455 Valuation processes for Level 3 Fair Value Measurements Fair value measurement of the derivative warrant liabilities falls within Level 3 of the fair value hierarchy. The fair value measurements are evaluated by management to ensure that changes are consistent with expectations of management based upon the sensitivity and nature of the inputs. May 2015 Warrants September 30, 2018: Description Valuation technique Unobservable inputs Range Derivative warrant liabilities Black-Scholes-Merton Volatility 70.37 % Risk-free interest rate 2.72 % Expected term, in years 1.59 Dividend yield 0.00 % December 31, 2017: Description Valuation technique Unobservable inputs Range Derivative warrant liabilities Black-Scholes-Merton Volatility 39.64 % Risk-free interest rate 1.88 % Expected term, in years 2.34 Dividend yield 0.00 % May 2018 Warrants September 30, 2018: Description Valuation technique Unobservable inputs Range Derivative warrant liabilities – A Warrants Black-Scholes-Merton Volatility 70.93 % Risk-free interest rate 2.96 % Expected term, in years 4.63 Dividend yield 0.00 % Description Valuation technique Unobservable inputs Range Derivative warrant liabilities – B Warrants Black-Scholes-Merton Volatility 113.31 % Risk-free interest rate 1.91 % Expected term, in years 0.12 Dividend yield 0.00 % May 17, 2018: Description Valuation technique Unobservable inputs Range Derivative warrant liabilities – A Warrants Black-Scholes-Merton Volatility 71.13 % Risk-free interest rate 2.98 % Expected term, in years 5.00 Dividend yield 0.00 % Description Valuation technique Unobservable inputs Range Derivative warrant liabilities – B Warrants Black-Scholes-Merton Volatility 72.88 % Risk-free interest rate 1.99 % Expected term, in years 0.50 Dividend yield 0.00 % Sensitivity of Level 3 measurements to changes in significant unobservable inputs The inputs to estimate the fair value of the Company’s derivative warrant liabilities were the current market price of the Company’s Common Stock, the exercise price of the derivative warrant liabilities, their remaining expected term, the volatility of the Company’s Common Stock price and the risk-free interest rate over the expected term. Significant changes in any of those inputs in isolation can result in a significant change in the fair value measurement. Generally, an increase in the market price of the Company’s shares of Common Stock, an increase in the volatility of the Company’s shares of Common Stock, and an increase in the remaining term of the derivative warrant liabilities would each result in a directionally similar change in the estimated fair value of the Company’s derivative warrant liabilities. Such changes would increase the associated liability while decreases in these assumptions would decrease the associated liability. An increase in the risk-free interest rate or a decrease in the differential between the derivative warrant liabilities’ exercise price and the market price of the Company’s shares of Common Stock would result in a decrease in the estimated fair value measurement and thus a decrease in the associated liability. The Company has not declared, and does not plan to declare, dividends on its Common Stock, and as such, there is no change in the estimated fair value of the derivative warrant liabilities due to the dividend assumption. Marathon Common Stock On January 11, 2018 (the “Transaction Date”), the Company entered into a Patent Rights Purchase and Assignment Agreement (the “Agreement”) with Crypto Currency Patent Holding Company LLC (the “Buyer”) and its parent company, Marathon, pursuant to which the Buyer agreed to purchase certain of the Company’s patents. As consideration for the patents, the Buyer paid $250 and Marathon issued 250,000 The Marathon Common Stock is recognized as a cost method investment and, as such, was required to be measured at cost on the date of acquisition, which, as of the Transaction Date, approximated fair value. The following table presents the placement in the fair value hierarchy of the Marathon Common Stock measured at fair value on a nonrecurring basis as of the Transaction Date: Fair value measurement at reporting date using Quoted prices in active markets Significant other Significant for identical observable unobservable Balance assets (Level 1) inputs (Level 2) inputs (Level 3) January 11, 2018 $ 450 $ — $ 450 $ — September 30, 2018 $ 43 $ 43 $ — $ — The fair value of the Marathon Common Stock was estimated by multiplying the number of shares as they become tradeable by the price per share as of the Transaction Date, information that falls within Level 1 of the fair value hierarchy, quoted prices in active markets for identical assets; however, due to the fact that the Marathon Common Stock was restricted during the Lockup Period, the Company applied a discount on the lack of marketability to estimate the fair value at the measurement date, which is a significant other observable input resulting in placement in Level 2 of the fair value hierarchy. The fair value of the consideration as of the Transaction Date was determined to be $450. Based on the Company’s evaluation of the investment, it was determined that certain unrealized losses represented an other-than-temporary impairment as of September 30, 2018 and the Company recognized an impairment charge of $26 and $133 for the three and nine months ended September 30, 2018, equal to the excess of carrying value over fair value. The fair value of the remaining Marathon Common Stock held as of September 30, 2018 was determined to be $43, which is included in other assets in the condensed consolidated balance sheet as of September 30, 2018. On July 11, 2018, the Lockup Period concluded and the Company was permitted to begin trading the Marathon Common Stock, subject to a leak-out provision whereby the shares were released from lockup in equal increments over a twenty-day period. As of September 30, 2018, the remaining 49,954 shares of Marathon Common Stock were no longer restricted pursuant to the Lockup Period and leak-out provision, and the Company determined that the investments are classified within Level 1 of the fair value hierarchy. During the three-month period ended September 30, 2018, the Company sold 200,046 shares of Marathon common stock, with a carrying value of $274, for net proceeds of $193. The following table summarizes the changes in the Company’s investment in Marathon Common Stock, measured at fair value using significant other observable inputs (Level 2) as of Transaction Date and measured at fair value using quoted prices in active markets for identical assets (Level 1) during the three- and nine-month periods ended September 30, 2018: January 11, 2018 $ 450 Carrying value of Marathon Common Stock sold (274 ) Decrease in fair value of the Marathon Common Stock (133 ) September 30, 2018 $ 43 Other Fair Value Measurements The Company is also required to measure the fair value of the contingent consideration it assumed following the acquisition of Excalibur Integrated Systems, Inc. (“Excalibur”) on February 2, 2017 on a recurring basis. The Company determined that there was no change in the fair value of the contingent consideration of $316 between December 31, 2017 and September 30, 2018. Although the Company disposed of Excalibur as part of the Group Mobile disposition, the contingent consideration remained due to the remnant of the earn-out provision due to the former stockholders of Excalibur, which is what first led to the recognition of a contingent consideration upon the acquisition of Excalibur. The contingent consideration is included in other liabilities in the condensed consolidated balance sheets. The purchase value of the contingent consideration assumed by the Company following the acquisition of Excalibur was determined using the Monte-Carlo simulation and, as such, was classified in Level 3 of the fair value hierarchy. The fair value measurements are evaluated by management to ensure that changes are consistent with expectations of management based upon the sensitivity and nature of the inputs. |
Stock-Based Compensation
Stock-Based Compensation | 9 Months Ended |
Sep. 30, 2018 | |
Share-based Compensation [Abstract] | |
Stock-based Compensation | Note 8. Stock-Based Compensation As of September 30, 2018, 3,358,470 shares of the Company’s Common Stock were available for future grants under the Company’s 2012 Employee, Director and Consultant Equity Incentive Plan. Total stock-based compensation expense for the three-month periods ended September 30, 2018 and 2017 was $194 and $706, respectively, the latter of which included stock-based compensation expense of $44 included in discontinued operations. Total stock-based compensation expense for the nine-month periods ended September 30, 2018 and 2017 was $765 and $2,179, respectively, the latter of which included stock-based compensation expense of $427 included in discontinued operations. The following table summarizes the RSUs granted to employees and consultants during the nine-month period ended September 30, 2018. Grant date No. of RSUs Fair market value at grant date Vesting term February 28, 2018 53,408 $ 0.94 Vesting immediately upon grant April 19, 2018 150,000 $ 0.60 Vesting immediately upon grant May 15, 2018 465,000 $ 0.60 Over one year, vesting on one-year anniversary of grant date No options were granted during the nine-month period ended September 30, 2018. The activity related to RSUs and stock options during the nine-month period ended September 30, 2018 consisted of the following: RSUs Options No. of RSUs Weighted average grant date fair value No. of options Weighted average exercise price Exercise price range Weighted average grant date fair value Outstanding as of January 1, 2018 365,565 $ 2.12 4,317,942 $ 5.67 $ 1.10 – 41.00 $ 3.86 Granted 668,408 $ 0.63 — — — — Vested/Exercised (568,973 ) $ 1.61 — — — — Forfeited (10,000 ) $ 0.60 (1,980,625 ) $ 6.17 $ 1.55 – 37.20 $ 4.11 Expired — — (52,317 ) $ 16.24 $ 9.60 – 16.50 $ 9.71 Outstanding as of September 30, 2018 455,000 $ 0.60 2,285,000 $ 4.99 $ 1.10 – 41.00 $ 3.12 Exercisable as of September 30, 2018 — — 1,905,834 $ 5.59 $ 1.10 – 41.00 $ 3.53 The Company did not recognize tax benefits related to its stock-based compensation as there is a full valuation allowance recorded. |
Debt and Convertible Notes
Debt and Convertible Notes | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Debt and Convertible Notes | Note 9. Debt and Convertible Notes Debt On April 22, 2015, prior to the acquisition of XpresSpa, XpresSpa entered into a credit agreement and secured promissory note (the “Debt”) with Rockmore Investment Master Fund Ltd. (“Rockmore”), a related party, which was amended on August 8, 2016 in connection with the acquisition of XpresSpa. Rockmore is an investment entity controlled by the Company’s Chairman of the Board of Directors, Bruce T. Bernstein. The Debt had an outstanding balance of $6,500 as of September 30, 2018 and December 31, 2017, which is included in long-term liabilities in the condensed consolidated balance sheets. During the nine-month period ended September 30, 2018, XpresSpa paid $580 of interest and recorded $548 of interest expense related to the debt. On May 14, 2018, the Company and Rockmore agreed to extend the maturity date of the Debt from May 1, 2019 to December 31, 2019. No other material terms of the Debt were modified. As consideration for the agreement to extend the maturity date of the Debt and the consent to the Securities Purchase Agreement, the Company issued to Rockmore 250,000 Class A Warrants. These Class A Warrants were issued on the same terms and conditions as the Class A Warrants issued under the Securities Purchase Agreement. The warrants issued to Rockmore were classified as equity warrants in the condensed consolidated balance sheet as of September 30, 2018. Convertible Notes On May 15, 2018, the Company entered into the Securities Purchase Agreement with the Investors, pursuant to which the Company agreed to sell up to (i) an aggregate principal amount of $4,438 in the Convertible Notes, which includes $88 issued to Palladium Capital Advisors as Placement Agent, convertible into Common Stock at a conversion price of $0.62 per share, (ii) Class A Warrants to purchase 7,157,259 shares of Common Stock at an exercise price of $0.62 per share and (iii) Class B Warrants to purchase up to 3,578,630 shares of Common Stock at an exercise price of $0.62 per share. The Convertible Notes bear interest at a rate of 5% per annum. The Convertible Notes are senior secured obligations of the Company and are secured by certain of its personal property. Unless earlier converted or redeemed, the Convertible Notes will mature on November 16, 2019. The transaction closed on May 17, 2018. The principal amount of the outstanding Convertible Notes is to be repaid monthly in the amount of $296, beginning on September 17, 2018, and the Company may make such payments and related interest payments in cash or, subject to certain conditions, in registered shares of Common Stock (or a combination thereof), at its election. If the Company chooses to repay the Convertible Notes in shares of Common Stock, the shares will be issued at a 10% discount to the volume weighted average price of Common Stock for the five (5) trading days commencing eight (8) days prior to the relevant repayment date and ending on the fourth (4 th On August 14, 2018, the Company and each of the Investors entered into an Amendment Agreement (“Amendment Agreement”) whereby the initial monthly principal repayment and accrued interest due on the Convertible Notes of $351 was settled in 2,067 shares of Common Stock on August 15, 2018. All other material terms of the Securities Purchase Agreement remained unchanged. During the three-month period ended September 30, 2018, several of the Investors converted their monthly principal payments and accrued interest due on the Convertible Notes into shares of Common Stock pursuant to the Amendment Agreement, resulting in the issuance of an additional 2,737 shares of Common Stock. The table below summarizes the initial fair value of the Convertible Notes and Warrants as of May 17, 2018: Class A Warrants $ 1,827 Class B Warrants 135 Convertible Notes 2,388 Total Fair Value $ 4,350 The table below summarizes changes in the book value of the Convertible Notes from May 17, 2018 to September 30, 2018: Book value as of May 17, 2018 $ 2,388 Debt issuance costs (320 ) Book value as of May 17, 2018 2,068 Debt repayments in the period (649 ) Amortization of debt discount and debt issuance costs, included in interest expense 589 Book value as of September 30, 2018 $ 2,008 The debt discount and debt issuance costs will be amortized on a straight-line basis over the remaining term of the Convertible Notes. During the three- and nine-month periods ended September 30, 2018, the Company recorded $394 and $589 of amortization of debt discount and debt issuance costs, which was included in interest expense for the three- and nine-month periods ended September 30, 2018. Additionally, for the three- and nine-month periods ended September 30, 2018, the Company recorded $48 and $75 of interest expense related to the Convertible Notes, which was included in interest expense. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2018 | |
Related Party Transactions [Abstract] | |
Related Party Transactions Disclosure | Note 10. Related Party Transactions On April 14, 2018, the Company entered into a consulting agreement with an employee of Mistral Equity Partners, which is a significant shareholder of the Company and whose Chief Executive Officer is a member of the Board of Directors of the Company, to consult on certain business-related matters. The total consideration is approximately $10 per month through December 31, 2018. The agreement may be terminated by either party at any time upon delivery of written notice. Pursuant to the agreement, the Company recorded consulting expense of $30 and $55 for the three- and nine-month periods ended September 30, 2018, respectively. |
Discontinued Operations and Ass
Discontinued Operations and Assets and Liabilities Held for Disposal | 9 Months Ended |
Sep. 30, 2018 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations and Assets and Liabilities Held For Disposal | Note 11. Discontinued Operations and Assets and Liabilities Held for Disposal FLI Charge On October 20, 2017, the Company sold FLI Charge to a group of private investors and FLI Charge management, to own and operate FLI Charge. Post-closing, the Company does not provide any continued management or financing support to FLI Charge. Group Mobile On March 7, 2018 (the “Signing Date”), the Company entered into a membership purchase agreement (the “Group Mobile Purchase Agreement”) with Route1 Security Corporation, a Delaware corporation (the “Buyer”), and Route1 pursuant to which the Buyer agreed to acquire Group Mobile (the “Disposition”). The transaction closed on March 22, 2018 (the “Closing Date”), after which the Company no longer had any involvement with Group Mobile. In consideration for the Disposition, the Buyer issued to the Company: 25,000,000 shares of Route1 Common Stock (the “Route1 Common Stock”); warrants to purchase 30,000,000 shares of Route1 Common Stock, which will feature an exercise price of CAD 5 cents per share of Common Stock and will be exercisable for a three-year period; and certain other payments over the three-year period pursuant to an earn-out provision in the Group Mobile Purchase Agreement. The Company retained certain inventory with a value of $555 to be disposed of separately from the transaction with Route1 in the first half of 2018. Of this amount, $110 was sold as of June 30, 2018. The remaining inventory excluded from the transaction was subsequently determined to be obsolete and unsalable and was fully written off as of June 30, 2018. Assets held for disposal includes $109 of accounts receivable, net of allowance, associated with the sale of the inventory excluded from the transaction with Route1. Post-closing, the Company owned approximately 6.7% of Route1 Common Stock. The Route1 Common Stock is not tradable until a date no earlier than 12 months after the Closing Date; 50%, or 12,500,000 shares, of Route1 Common Stock are tradeable after 12 months plus an additional 2,083,333 shares of Route1 Common Stock are tradeable each month until 18 months after the Closing Date, subject to a change of control provision. The Company has the ability to sell the Route1 Common Stock and warrants to qualified institutional investors. The Group Mobile Purchase Agreement also contains representations, warranties, and covenants customary for transactions of this type. The total consideration of the Disposition is recognized as a cost method investment and, as such, must be measured at cost on the date of acquisition, which, as of the Closing Date, approximates fair value. The fair value of the total consideration as of the Closing Date was determined to be $1,625, which is less than the carrying value of the asset, and is included in other assets in the condensed consolidated balance sheet as of September 30, 2018. This resulted in a loss on disposal of $301, which is included in consolidated net loss from discontinued operations in the condensed consolidated statement of operations and comprehensive loss for the nine-month period ended September 30, 2018. The value of the total consideration for the Group Mobile disposition was determined using a combination of valuation methods including: (i) The value of the Route 1 Common Stock was determined to be $308, which was estimated by multiplying the number of shares as they become tradeable by the price per share as of the Closing Date. (ii) The value of the warrants was determined to be $176, which was obtained using the Black-Scholes-Merton model. (iii) The value of the earn-out provision was determined to be $1,141, which was estimated using a Monte-Carlo simulation analysis. The value of the Route1 Common Stock was classified within Level 2 of the fair value hierarchy because, although quoted prices in active markets for identical assets were used, which is a Level 1 attribute, the Company applied a discount on the lack of marketability to estimate the fair value due to the fact that the Route1 Common Stock will be restricted for different periods, which is a significant other observable input. The value of the warrants and earn-out provision were classified within Level 3 of the fair value hierarchy because they were valued using the Black-Scholes-Merton model and a Monte-Carlo simulation analysis, respectively, each of which utilizes significant inputs that are unobservable in the market. The Company’s fair value measurements are evaluated by management to ensure that they are consistent with expectations of management based upon the sensitivity and nature of the inputs. Operating Results and Assets and Liabilities Held for Sale The following table presents the components of the consolidated net loss from discontinued operations, as presented in the condensed consolidated statements of operations and comprehensive loss, for the three- and nine-month periods ended September 30, 2018 for Group Mobile and September 30, 2017 for Group Mobile and FLI Charge: Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 Revenue $ — $ 4,889 $ 2,834 $ 11,883 Cost of sales — (3,918 ) (2,305 ) (9,603 ) Depreciation and amortization — (196 ) (131 ) (568 ) Impairment — — — (1,092 ) General and administrative — (1,463 ) (1,190 ) (5,079 ) Loss on disposal — — (301 ) — Non-operating income (expense), net — (11 ) (22 ) (15 ) Loss from discontinued operations before income taxes — (699 ) (1,115 ) (4,474 ) Income tax benefit (expense) — — — — Consolidated net loss from discontinued operations $ — $ (699 ) $ (1,115 ) $ (4,474 ) In addition, the following table presents the carrying amounts of Group Mobile’s major classes of assets and liabilities held for disposal as of September 30, 2018 and December 31, 2017, as presented in the condensed consolidated balance sheets: September 30, 2018 December 31, 2017 Cash $ — $ 150 Accounts receivable, net 109 2,920 Inventory — 1,935 Other current assets — 3 Property and equipment, net — 874 Intangible assets, net — 564 Assets held for disposal $ 109 $ 6,446 Accounts payable, accrued expenses and other current liabilities $ 40 $ 3,142 Deferred revenue — 619 Liabilities held for disposal $ 40 $ 3,761 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 12. Income Taxes The Company’s provision for income taxes consists of federal, state, local, and foreign taxes in amounts necessary to align the Company’s year-to-date provision for income taxes with the effective tax rate that the Company expects to achieve for the full year. Each quarter, the Company updates its estimate of the annual effective tax rate and records cumulative adjustments as deemed necessary. The income tax provisions for the nine-month period ended September 30, 2018 reflect an estimated global annual effective tax rate of approximately 0.44 %. As of September 30, 2018, deferred tax assets generated from the Company’s activities in the United States were offset by a valuation allowance because realization depends on generating future taxable income, which, in the Company’s estimation, is not more likely than not to be generated before such net operating loss carryforwards expire. The Company expects its effective tax rate for its current fiscal year to be significantly lower than the statutory rate as a result of a full valuation allowance; therefore, any loss before income taxes does not generate a corresponding income tax benefit. Income tax benefit for the nine-month period ended September 30, 2018 of $ 198 was attributable primarily to the reduction to the valuation allowance as a result of the Tax Cuts and Jobs Act’s impact on the lives of net operating losses. The final annual tax rate cannot be determined until the end of the fiscal year; therefore, the actual tax rate could differ from current estimates. Although the Company has an immaterial amount of uncertain tax positions, the Company does not expect to record any additional material provisions for unrecognized tax benefits in the next year. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 13. Commitments and Contingencies Litigation and legal proceedings Certain of the Company’s outstanding legal matters include speculative claims for substantial or indeterminate amounts of damages. The Company regularly evaluates developments in its legal matters that could affect the amount of any potential liability and makes adjustments as appropriate. Significant judgment is required to determine both the likelihood of there being a liability and the estimated amount of a loss related to such matters. With respect to the Company’s outstanding legal matters, based on its current knowledge, the Company’s management believes that the amount or range of a potential loss will not, either individually or in the aggregate, have a material adverse effect on its business, consolidated financial position, results of operations or cash flows. However, the outcome of such legal matters is inherently unpredictable and subject to significant uncertainties. The Company evaluated the matters described below and assessed the probability and likelihood of the occurrence of liability. Based on management’s estimates, the Company has accrued $290 for such potential losses, which is included in accounts payable, accrued expenses, and other current liabilities in the condensed consolidated balance sheet as of September 30, 2018. The Company expenses legal fees in the period in which they are incurred. Cordial Effective October 2014, XpresSpa terminated its former Airport Concession Disadvantaged Business Enterprise (“ACDBE”) partner, Cordial Endeavor Concessions of Atlanta, LLC (“Cordial”), in several store locations at Hartsfield-Jackson Atlanta International Airport. Cordial filed a series of complaints with the City of Atlanta, both before and after the termination, in which Cordial alleged, among other things, that the termination was not valid and that XpresSpa unlawfully retaliated against Cordial when Cordial raised concerns about the joint venture. In response to the numerous complaints it received from Cordial, the City of Atlanta required the parties to engage in two mediations. After the termination of the relationship with Cordial, XpresSpa sought to substitute two new ACDBE partners in place of Cordial. In April 2015, Cordial filed a complaint with the United States Federal Aviation Administration (“FAA”), which oversees the City of Atlanta with regard to airport ACDBE programs, and, in December 2015, the FAA instructed that the City of Atlanta review XpresSpa’s request to substitute new partners in lieu of Cordial and Cordial’s claims of retaliation. In response to the FAA instruction, pursuant to a corrective action plan approved by the FAA, the City of Atlanta held a hearing in February 2016 and ruled in favor of XpresSpa such substitution and claims of retaliation. Cordial submitted a further complaint to the FAA claiming that the City of Atlanta was biased against Cordial and that the City of Atlanta’s decision was wrong. In August 2016, the parties met with the FAA. On October 4, 2016, the FAA sent a letter to the City of Atlanta directing that the City of Atlanta retract previous findings on Cordial’s allegations and engage an independent third party to investigate issues previously decided by Atlanta. The FAA also directed that the City of Atlanta determine monies potentially due to Cordial. On January 3, 2017, XpresSpa filed a lawsuit in the Supreme Court of the State of New York, County of New York, against Cordial and several related parties. The lawsuit alleges breach of contract, unjust enrichment, breach of fiduciary duty, fraudulent inducement, fraudulent concealment, tortious interference, and breach of good faith and fair dealing. XpresSpa is seeking damages, declaratory judgment, rescission/termination of certain agreements, disgorgement of revenue, fees and costs, and various other relief. On February 21, 2017, the defendants filed a motion to dismiss. On March 3, 2017, XpresSpa filed a first amended complaint against the defendants. On April 5, 2017, Cordial filed a motion to dismiss. On September 12, 2017, the Court held a hearing on the motion to dismiss. On November 2, 2017, the Court granted the motion to dismiss which was entered on November 13, 2017. On December 22, 2017, XpresSpa filed a notice of appeal, and on September 24, 2018, XpresSpa perfected its appellate rights and submitted a brief to the Supreme Court of New York, First Department appellate court. Oral arguments on the appeal are expected to take place in early 2019. On March 30, 2018, Cordial filed a lawsuit against XpresSpa, a subsidiary of XpresSpa, and several additional parties in the Superior Court of Fulton County, Georgia, alleging the violation of Cordial’s civil rights, tortious interference, breach of fiduciary duty, civil conspiracy, conversion, retaliation, and unjust enrichment. Cordial has threated to seek punitive damages, attorneys’ fees and litigation expenses, accounting, indemnification, and declaratory judgment as to the status of the membership interests of XpresSpa and Cordial in the joint venture and Cordial’s right to profit distributions and management fees from the joint venture. On May 3, 2018, the Court issued an order extending the time for the defendants to respond to Cordial’s lawsuit until June 25, 2018. On May 4, 2018, the defendants moved the lawsuit to the United States District Court for the Northern District of Georgia. On June 5, 2018, the Court granted an extension of time for the defendants’ response until August 17, 2018. On August 9, 2018, the Court granted an additional extension of time for the defendants’ response until In re Chen et al. In March 2015, four former XpresSpa employees who worked at XpresSpa locations in John F. Kennedy International Airport and LaGuardia Airport filed a putative class and collective action wage-hour litigation in the United States District Court, Eastern District of New York. In re Chen et al. , CV 15-1347 (E.D.N.Y.). Plaintiffs claim that they and other spa technicians around the country were misclassified as exempt commissioned salespersons under Section 7(i) of the federal Fair Labor Standards Act (“FLSA”). Plaintiffs also assert class claims for unpaid overtime on behalf of New York spa technicians under the New York Labor Law, and discriminatory employment practices under New York State and City laws. On July 1, 2015, the plaintiffs moved to have the court authorize notice of the FLSA misclassification claim sent to all employees in the spa technician job classification at XpresSpa locations around the country in the last three years. Defendants opposed the motion. On February 16, 2016, the Magistrate Judge assigned to the case issued a Report & Recommendation, recommending that the District Court Judge grant the plaintiffs’ motion. On March 1, 2016, the defendants filed Opposition to the Magistrate Judge’s Report & Recommendation, arguing that the District Court Judge should reject the Magistrate Judge’s findings. On September 23, 2016, the court ruled in favor of the plaintiffs and conditionally certified the class. The parties held a mediation on February 28, 2017 and reached an agreement on a settlement in principle. On September 6, 2017, the parties entered into a settlement agreement. On September 15, 2017, the parties filed a motion for settlement approval with the Court. XpresSpa subsequently paid the agreed-upon settlement amount to the settlement claims administrator to be held in escrow pending a fairness hearing and final approval by the Court. On March 30, 2018 the Court entered a Memorandum and Order denying the motion without prejudice to renewal due to questions and concerns the Court had about certain settlement terms. On April 24, 2018 the parties jointly submitted a supplemental letter to the Court advocating for the fairness and adequacy of the settlement, and appeared in Court on April 25, 2018 for a hearing to discuss the settlement terms in greater detail with the assigned Magistrate Judge. At the conclusion of the hearing, the Court still had questions about the adequacy and fairness of the settlement terms, and the Judge asked that the parties jointly submit additional information to the Court addressing the open issues. The parties submitted such information to the Court on May 18, 2018 and are awaiting the Court’s ruling on the open issues. Binn v. FORM Holdings Corp. et al. On November 6, 2017, Moreton Binn and Marisol F, LLC, former stockholders of XpresSpa, filed a lawsuit against the Company and its directors in the United States District Court for the Southern District of New York. The lawsuit alleges violations of various sections of the Exchange Act, material omissions and misrepresentations (negligent and fraudulent), fraudulent omission, expropriation, breach of fiduciary duties, aiding and abetting, and unjust enrichment in the defendants’ conduct related to the Company’s acquisition of XpresSpa, and seeks rescission of the transaction, damages, equitable and injunctive relief, fees and costs, and various other relief. On January 17, 2018, the defendants filed a motion to dismiss the complaint. On February 7, 2018, the plaintiffs amended their complaint. On February 28, 2018, the defendants filed a motion to dismiss the amended complaint. On March 21, 2018, the plaintiffs filed an opposition to the motion to dismiss the amended complaint. On March 30, 2018, the defendants filed a reply in further support of the defendants’ motion to dismiss the amended complaint. On August 7, 2018, the Court ruled on the defendants’ motion to dismiss the amended complaint, dismissing eight of the plaintiffs’ ten claims and denying the defendants’ motion to dismiss with respect to the two remaining claims, related to the Exchange Act. Route1 On May 23, 2018, Route1 and Group Mobile filed a Statement of Claim against the Company in the Ontario (Canada) Superior Court of Justice seeking monetary damages based on indemnity claims made by Route1 and Group Mobile pursuant to the Group Mobile Purchase Agreement, including an offset against funds payable to the Company by Route1 and Group Mobile pursuant to the Group Mobile Purchase Agreement. On August 13, 2018, the Company filed its Defence and Counterclaim, seeking the payment of such funds payable to the Company by Route1 and Group Mobile pursuant to the Group Mobile Purchase Agreement. In addition to those matters specifically set forth herein, the Company and its subsidiaries are involved in various other claims and legal actions that arise in the ordinary course of business. The Company does not believe that the ultimate resolution of these actions will have a material adverse effect on the Company’s financial position, results of operations, liquidity, or capital resources. However, a significant increase in the number of these claims, or one or more successful claims under which the Company incurs greater liabilities than the Company currently anticipates, could materially adversely affect the Company’s business, financial condition, results of operations and cash flows. In the event that an action is brought against the Company or one of its subsidiaries, the Company will investigate the allegation and vigorously defend itself. Intellectual Property The Company is engaged in litigation related to certain of the intellectual property that it owns, for which no liability is recorded, as the Company does not expect a material negative outcome. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 14. Subsequent Events Collaboration Agreement On November 12, 2018, the Company entered into a Product Sale and Marketing Agreement (the “Collaboration Agreement”) with Calm.com, Inc. (“Calm”) primarily related to the display, marketing, promotion, offer for sale and sale of Calm’s products in each of the Company’s branded stores throughout the United States. The Collaboration Agreement shall remain in effect until July 31, 2019, unless terminated earlier in accordance with the Collaboration Agreement, and automatically renew for successive terms of six (6) months unless either party provides written notice of termination no later than thirty (30) days prior to any such automatic renewal of the Collaboration Agreement. The foregoing description of the Collaboration Agreement is only a summary and is qualified in its entirety by reference to the Collaboration Agreement. The Company intends to file a copy of the Collaboration Agreement as exhibit to its Annual Report on Form 10-K for its fiscal year ending December 31, 2018, portions of which will be subject to a FOIA Confidential Treatment Request which will be submitted to the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended. The omitted material will be included in the request for confidential treatment. Stock Purchase Agreement In connection with the entry into the Collaboration Agreement, the Company entered into a stock purchase agreement (the “Purchase Agreement”) with Calm, pursuant to which the Company issued to Calm an aggregate of 645,161 shares of the Company’s newly designated Series E Convertible Preferred Stock, par value $0.01 per share (the “Series E Preferred Stock”), which is initially convertible into 3,225,806 shares of the Company’s Common Stock, par value $0.01 per share (the “Common Stock”) at a conversion price of $0.62 per share, subject to certain adjustments. The purchase price per share of the Series E Preferred Stock was $3.10 per share for gross proceeds to the Company of $2,000,000. In addition, on or before December 31, 2018 and subject to the satisfaction of the conditions under the Purchase Agreement, the Company shall sell, and Calm shall purchase, 322,581 additional shares of Series E Preferred Stock (the “Additional Series E Shares”), which will initially be convertible into 1,612,905 shares of the Company’s Common Stock at a conversion price of $0.62 per share, subject to certain adjustments, for gross proceeds to the Company of $1,000,000, which sale of Additional Series E Shares shall be on the same terms and conditions as those contained in the Purchase Agreement. Series E Preferred Stock On November 12, 2018, the Company filed with the Secretary of State of the State of Delaware a Certificate of Designation of Preferences, Rights and Limitations of Series E Convertible Preferred Stock (the “Certificate of Designations”). Pursuant to the Certificate of Designations, the holders of the Series E Preferred Stock are entitled, among other things, to an aggregate initial liquidation preference of $2,000,000 ($3,000,000 if the Second Closing occurs) and the right to participate in any dividends and distributions paid to common stockholders on an as-converted basis. The Series E Preferred Stock will vote on an as-converted basis. The Series E Preferred Stock is convertible at any time and from time to time without the payment of additional consideration and has a stated value of $3.10 per share of Series E Preferred Stock. In the event of any liquidation or dissolution of the Company, the Series E Preferred Stock ranks senior to any other class of preferred stock and to the Common Stock in the distribution of assets, to the extent legally available for distribution. Upon the occurrence of certain fundamental events, the holders of the Series E Preferred Stock will be able to require the Company to redeem the shares of Series E Preferred Stock at the greater of the liquidation preference and the amount per share as would have been payable had the shares of Series E Preferred Stock been converted into Common Stock. Pursuant to the terms of the Certificate of Designations, on the seven (7) year anniversary of the initial issuance date of the shares of Series E Preferred Stock, the Company may repay each share of the Series E Preferred Stock, at its option, in cash, by delivery of Common Stock or through any combination thereof. Additionally, under certain conditions, the Company may have the right, but not the obligation to convert the outstanding shares of Series E Preferred Stock into Common Stock. If the Company elects to make a payment, or any portion thereof, in shares of Common Stock, the number of shares deliverable (the “Base Shares”) will be based on the volume weighted average price (the “VWAP”) per share of Common Stock for the thirty (30) trading days prior to the date of calculation (the “Base Price”) plus an additional number of shares of Common Stock (the “Premium Shares”), calculated as follows: (i) if the Base Price is greater than $9.00, no Premium Shares shall be issued, (ii) if the Base Price is greater than $7.00 and equal to or less than $9.00, an additional number of shares equal to 5% of the Base Shares shall be issued, (iii) if the Base Price is greater than $6.00 and equal to or less than $7.00, an additional number of shares equal to 10% of the Base Shares shall be issued, (iv) if the Base Price is greater than $5.00 and equal to or less than $6.00, an additional number of shares equal to 20% of the Base Shares shall be issued and (v) if the Base Price is less than or equal to $5.00, an additional number of shares equal to 25% of the Base Shares shall be issued. Accordingly, if the volume weighted average price per share of Common Stock is below $9.00 per share at the time of repayment and the Company exercises the option to make such repayment in shares of Common Stock, a large number of shares of Common Stock may be issued to the holders of Series E Preferred Stock upon maturity, which may have a negative effect on the trading price of Common Stock. At the seven (7) year maturity date of the Series E Preferred Stock, the Company, at its election, may decide to issue shares of Common Stock based on the formula set forth above or to re-pay in cash all or any portion of the Series E Preferred Stock. However, in no event, shall the VWAP per share of Common Stock be determined to be less than $0.62. In 2025, upon the maturity date of the Series E Preferred Stock, when determining whether to repay the Series E Preferred Stock in cash or shares of Common Stock, the Company expects to consider a number of factors, including its cash position, the price of the Common Stock and the Company’s capital structure at such time. Because the Company does not have to make a determination as to which option to elect until 2025, it is impossible to predict whether it is more or less likely to repay in cash, stock or a portion of each. In addition, the Series E Preferred Stock contains certain protective provisions that limit the Company’s ability to make certain cash distributions or payment of any indebtedness without the written consent of the holders of a majority of the outstanding shares of Series E Preferred Stock. The offering is exempt from registration pursuant to the exemption for transactions by an issuer not involving any public offering under Section 4(a)(2) the Securities Act and Regulation D under the Securities Act. The shares of Series E Preferred Stock sold and issued in connection with the Purchase Agreement are not registered under the Securities Act or any state securities laws and may not be offered or sold in the United States absent registration with the SEC or an applicable exemption from the registration requirements. Seniority to Series D Convertible Preferred Stock In connection with the entry into the Purchase Agreement, a majority of the holders of the Company’s Series D Convertible Preferred Stock (the “Series D Preferred Stock”) agreed to waive the provisions of the Certificate of Designation of Preferences, Rights and Limitations of Series D Convertible Preferred Stock prohibiting any class of stock existing senior to the Series D Preferred Stock with respect to right of participation in any dividends and distributions. Upon the issuance of the issuance of the Series E Preferred Stock, the Series D Preferred Stock will rank junior to the Series E Preferred Stock with respect to the Series E Preferred Stock’s initial liquidation preference and in right of participation in any dividends and distributions. Certificate of Designation On November 13, 2018, the Company filed the Certificate of Designations with the Secretary of State of the State of Delaware, establishing and designating the rights, powers and preferences of the Series E Preferred Stock. The Company designated up to 1,473,300 shares of Series E Preferred Stock. The foregoing summaries of the Purchase Agreement and Certificate of Designations do not purport to be complete and are qualified in their entirety by reference to the Purchase Agreement and Certificate of Designations, which are attached hereto as Exhibits 10.1 and 3.1, respectively, to this Quarterly Report on Form 10-Q and are incorporated by reference herein. |
Accounting and Reporting Poli_2
Accounting and Reporting Policies (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
Accounting Policies [Abstract] | |
Basis of presentation and principles of consolidation | (a) Basis of presentation and principles of consolidation The accompanying interim condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information and the instructions to Rule 10-01 of Regulation S-X, and should be read in conjunction with the Company's Annual Report on Form 10-K for the year ended December 31, 2017. The condensed consolidated financial statements include the accounts of the Company, all entities that are wholly-owned by the Company, and all entities in which the Company has a controlling financial interest. All adjustments that, in the opinion of management, are necessary for a fair presentation for the periods presented have been reflected by the Company. Such adjustments are of a normal, recurring nature. The results of operations for the three- and nine-month periods ended September 30, 2018 are not necessarily indicative of the results that may be expected for the entire fiscal year or for any other interim period. All significant intercompany balances and transactions have been eliminated in consolidation. |
Use of estimates | (b) Use of estimates The preparation of the accompanying condensed consolidated financial statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses for the periods presented. Actual results may differ from such estimates. Significant items subject to such estimates and assumptions include the Company’s intangible assets, investments classified as other assets, the useful lives of the Company’s intangible assets, the valuation of the Company’s derivative warrant liabilities, the valuation of stock-based compensation, deferred tax assets and liabilities, income tax uncertainties, and other contingencies. |
Cash and cash equivalents | (c) Cash and cash equivalents The Company maintains cash in checking accounts with financial institutions. The Company has established guidelines relating to diversification and maturities of its investments in order to minimize credit risk and maintain high liquidity of funds. Cash equivalents include amounts due from third-party financial institutions for credit and debit card transactions. These items typically settle in less than five days. As of September 30, 2018, the Company held significant portions of its cash balance in overseas accounts, totaling $1,081, which is not insured by the Federal Deposit Insurance Corporation (“FDIC”). If the Company were to distribute the amounts held overseas, the Company would need to follow an approval process as defined in its operating and partnership agreements, which may delay the availability of cash to the Company. |
Revenue recognition | (d) Revenue recognition The Company recognizes revenue from the sale of XpresSpa products and services at the point of sale, net of discounts and applicable sales taxes. Revenues from the XpresSpa wholesale and e-commerce businesses are recorded at the time goods are shipped. The Company excludes all sales taxes assessed to its customers. Sales taxes assessed on revenues are included in accounts payable, accrued expenses and other current liabilities in the condensed consolidated balance sheets until remitted to the state agencies. Other revenue relates to one-time intellectual property licenses as well as the sale of certain of the Company’s intellectual property. Revenue from patent licensing is recognized when the Company transfers promised intellectual property rights to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those intellectual property rights. Currently, revenue arrangements related to intellectual property provide for the payment of contractually determined fees and other consideration for the grant of certain intellectual property rights related to the Company’s patents. These rights typically include some combination of the following: (i) the grant of a non-exclusive, retroactive and future license to manufacture and/or sell products covered by patents, (ii) the release of the licensee from certain claims, and (iii) the dismissal of any pending litigation. The intellectual property rights granted typically extend until the expiration of the related patents. Pursuant to the terms of these agreements, the Company has no further obligation with respect to the grant of the non-exclusive retroactive and future licenses, covenants-not-to-sue, releases, and other deliverables, including no express or implied obligation on the Company’s part to maintain or upgrade the related technology, or provide future support or services. Generally, the agreements provide for the grant of the licenses, covenants-not-to-sue, releases, and other significant deliverables upon execution of the agreement, or upon receipt of the upfront payment. As such, the earnings process is complete and revenue is recognized upon the execution of the agreement, receipt of the upfront fee, and transfer of the promised intellectual property rights. |
Cost of Sales | (e) Cost of sales Cost of sales consists of store-level costs. Store-level costs include all costs that are directly attributable to the store operations and include: • payroll and related benefits for store operations and store-level management; • rent, percentage rent and occupancy costs; • the cost of merchandise; • freight, shipping and handling costs; • production costs; • inventory shortage and valuation adjustments, including purchase price allocation increase in fair values which was recorded as part of acquisition; and • costs associated with sourcing operations. Cost of sales related to the Company’s intellectual property mainly includes expenses incurred in connection with the Company’s patent licensing and enforcement activities, patent-related legal expenses paid to external patent counsel (including contingent legal fees), licensing and enforcement related research, consulting and other expenses paid to third parties, as well as related internal payroll expenses. |
Investments | (f) Investments The Company accounts for its investments in other entities using the cost method of accounting when the Company has no substantial influence over, and the investment is less than 20% of, the investee entity. Under the cost method, the investment is recorded at cost, which approximates fair value, on the date of acquisition. The Company performs an assessment for impairment on at least an annual basis, or when there is an indication that cost exceeds fair value. |
Fair value measurements | (g) Fair value measurements The Company measures fair value in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 820-10, Fair Value Measurements and Disclosures clarifies that fair value is an exit price, representing the amount that would be received by selling an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. As a basis for considering such assumptions, FASB ASC 820-10 establishes a three-tier value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value: Level 1 : Unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date. Level 2 : Other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability. Level 3 : Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at measurement date. The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. |
Recently issued accounting pronouncements | (h) Recently issued accounting pronouncements Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606) The core principle of this new standard is that revenue should be recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This guidance was amended in July 2015 and is effective for annual reporting periods beginning after December 15, 2017. Adoption of this ASU did not have a material impact on the Company’s condensed consolidated financial statements. ASU No. 2016-01, Financial Instruments – Overall (Topic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities This standard amends various aspects of the recognition, measurement, presentation, and disclosure for financial instruments. With respect to the Company’s condensed consolidated financial statements, the most significant impact relates to the accounting for equity investments. It will impact the disclosure and presentation of financial assets and liabilities. The amendments in this update are effective for annual reporting periods, and interim periods within those years beginning after December 15, 2017. Adoption of this ASU did not have a material impact on the Company’s condensed consolidated financial statements. ASU No. 2016-02, Leases (Topic 842) This standard provides new guidance related to accounting for leases and supersedes GAAP on lease accounting with the intent to increase transparency. This standard requires operating leases to be recorded on the balance sheet as assets and liabilities and requires disclosure of key information about leasing arrangements. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the statement of operations and comprehensive loss. The adoption will require a modified retrospective approach as of the beginning of the earliest period presented. The new standard is effective for the fiscal year beginning after December 15, 2018, with early adoption permitted. The Company is currently in the process of evaluating the impact of the adoption on its condensed consolidated financial statements, and expects that it will result in a significant increase in its long-term assets and liabilities. ASU No. 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment This standard provides new guidance to eliminate the requirement to calculate the implied fair value of goodwill, or the Step 2 test, to measure a goodwill impairment charge. Instead, entities will record an impairment charge based on the excess of a reporting unit’s carrying amount over its fair value. The loss recognized should not exceed the total goodwill allocated to the reporting unit. The new standard is effective for the fiscal year beginning after December 15, 2019, with early adoption permitted. The Company early adopted this standard effective January 1, 2018. Adoption of this ASU did not have a material impact on the Company’s condensed consolidated financial statements. ASU No. 2017-11, Earnings Per Share (Topic 260); Distinguishing Liabilities from Equity (Topic 480); Derivatives and Hedging (Topic 815) This standard provides new guidance to address the complexity of accounting for certain financial instruments with down round features. The amendments of this ASU change the classification analysis of certain equity-linked financial instruments (or embedded features) with down round features. A down round feature no longer precludes equity classification when assessing whether the instrument is indexed to an entity’s own stock. A freestanding equity-linked financial instrument (or embedded conversion feature) no longer would be accounted for as a derivative liability at fair value as a result of the existence of a down round feature. The new standard is effective for the fiscal year beginning after December 15, 2018 with early adoption permitted. The Company early adopted this standard effective January 1, 2018. Adoption of this ASU did not have a material impact on the Company’s condensed consolidated financial statements. ASU No. 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income This standard provides guidance on the reclassification of certain tax effects from accumulated other comprehensive income to retained earnings in the period in which the effects of the change in the United States federal corporate income tax rate in the Tax Cuts and Jobs Act is recorded. The new standard is effective for the fiscal year beginning after December 15, 2018. The Company is currently in the process of evaluating the impact of the adoption of this standard on its condensed consolidated financial statements. ASU No. 2018-11, Leases (Topic 842): Targeted Improvements This standard provides an optional transition method to adopt the new leases standard in Topic 842 which permits the recognition of a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. The amendments do not change the existing disclosure requirements in Topic 840. The new standard is effective for the fiscal year beginning after December 15, 2018. The Company is currently in the process of evaluating the impact of the adoption on its condensed consolidated financial statements, and expects that it will result in an adjustment to the opening balance of retained earnings in the period of adoption. ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement This amendment provides updates to the disclosure requirements on fair value measures in Topic 820 which includes the changes in unrealized gains and losses in other comprehensive income for recurring Level 3 fair value measurements, the option of additional quantitative information surrounding unobservable inputs and the elimination of disclosures around the valuation processes for Level 3 measurements. The new standard is effective for the fiscal year beginning after December 15, 2019. The Company is currently in the process of evaluating the impact of the adoption of this standard on its condensed consolidated financial statements. |
Reclassification | (i) Reclassification Certain balances have been reclassified to conform to presentation requirements, including the presentation of discontinued operations and the consistent presentation of the allocation of cost of sales and general and administrative expenses between store locations and corporate in the condensed consolidated statements of operations and comprehensive loss. |
Net Loss per Share of Common _2
Net Loss per Share of Common Stock (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Earnings Per Share, Basic and Diluted [Abstract] | |
Computation of Net Loss per Common Share | The table below presents the computation of basic and diluted net loss per share of Common Stock: Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 Basic and diluted numerator: Net loss from continuing operations attributable to shares of common stock $ (3,187 ) $ (3,998 ) $ (29,528 ) $ (13,658 ) Net loss from discontinued operations attributable to shares of common stock - (699 ) (1,115 ) (4,474 ) Net loss attributable to the Company $ (3,187 ) $ (4,697 ) $ (30,643 ) $ (18,132 ) Basic and diluted denominator: Basic shares of common stock outstanding 28,352,284 24,144,002 27,268,792 20,852,034 Basic loss per share of common stock from continuing operations $ (0.11 ) $ (0.16 ) $ (1.08 ) $ (0.65 ) Basic loss per share of common stock from discontinued operations - (0.04 ) (0.04 ) (0.22 ) Basic and diluted net loss per share of common stock $ (0.11 ) $ (0.20 ) $ (1.12 ) $ (0.87 ) Net loss per share data presented excludes from the calculation of diluted net loss the following potentially dilutive securities, as they had an anti-dilutive impact: Both vested and unvested options to purchase an equal number of shares of common stock of the Company 2,285,000 4,876,899 2,285,000 4,876,899 Unvested RSUs to issue an equal number of shares of common stock of the Company 455,000 365,565 455,000 365,565 Warrants to purchase an equal number of shares of common stock of the Company 14,073,390 3,087,500 14,073,390 3,087,500 Preferred stock on an as converted basis 3,364,328 3,439,587 3,364,328 3,620,626 Convertible notes on an as converted basis 4,350,000 — 4,350,000 — Total number of potentially dilutive instruments, excluded from the calculation of net loss per share 24,527,718 11,769,551 24,527,718 11,950,590 |
Other Assets (Tables)
Other Assets (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Other Noncurrent Assets [Abstract] | |
Schedule of Other Assets | Other assets in the condensed consolidated balance sheets are comprised of the following as of September 30, 2018 and December 31, 2017: September 30, 2018 December 31, 2017 Cost method investments $ 2,502 $ 834 Lease deposits 854 852 Other assets $ 3,356 $ 1,686 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Segment Reporting [Abstract] | |
Schedule of Revenue from External Customers Attributed to Foreign Countries by Geographic Area | Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 Revenue United States $ 11,516 $ 11,349 $ 34,513 $ 32,982 All other countries 1,406 1,503 4,047 3,881 Total revenue 12,922 12,852 38,560 36,863 Cost of sales United States 9,056 9,637 27,524 27,588 All other countries 929 836 2,597 2,338 Total cost of sales 9,985 10,473 30,121 29,926 Segment operating income (loss) United States (3,095 ) (4,052 ) (29,470 ) (13,704 ) All other countries 210 529 461 1,225 Operating loss from continuing operations (2,885 ) (3,523 ) (29,009 ) (12,479 ) Other non-operating expense, net (246 ) (265 ) (335 ) (566 ) Loss from continuing operations before income taxes $ (3,131 ) $ (3,788 ) $ (29,344 ) $ (13,045 ) September 30, 2018 December 31, 2017 Assets United States $ 29,878 $ 55,152 All other countries 2,677 3,642 Assets held for disposal 109 6,446 Total assets $ 32,664 $ 65,240 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Assets and Liabilities Measured at Fair Value on Recurring Basis | The following table presents the placement in the fair value hierarchy of derivative warrant liabilities measured at fair value on a recurring basis as of September 30, 2018, May 17, 2018 and December 31, 2017: May 2015 Warrants Fair value measurement at reporting date using Balance Quoted prices in active markets for identical assets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) September 30, 2018: $ 1 $ — $ — $ 1 December 31, 2017: $ 34 $ — $ — $ 34 May 2018 Warrants Fair value measurement at reporting date using Quoted prices in active markets Significant other Significant for identical observable unobservable Balance assets (Level 1) inputs (Level 2) inputs (Level 3) September 30,2018: A Warrants $ 455 $ — $ — $ 455 B Warrants — — — — Total $ 455 $ — $ — $ 455 May 17, 2018: A Warrants $ 1,827 $ — $ — $ 1,827 B Warrants 135 — — 135 Total $ 1,962 $ — $ — $ 1,962 |
Changes in Liabilities Measured at Fair Value Using Significant Unobservable Inputs | The following table summarizes the changes in the Company’s derivative warrant liabilities measured at fair value using significant unobservable inputs (Level 3) during the three- and nine-month periods ended September 30, 2018: December 31, 2017 $ 34 Issuance of warrants May 17, 2018 1,962 Decrease in fair value of the derivative warrant liabilities (1,541 ) September 30, 2018 $ 455 |
Fair Value Measurements Based Upon Sensitivity and Nature of Inputs | Fair value measurement of the derivative warrant liabilities falls within Level 3 of the fair value hierarchy. The fair value measurements are evaluated by management to ensure that changes are consistent with expectations of management based upon the sensitivity and nature of the inputs. May 2015 Warrants September 30, 2018: Description Valuation technique Unobservable inputs Range Derivative warrant liabilities Black-Scholes-Merton Volatility 70.37 % Risk-free interest rate 2.72 % Expected term, in years 1.59 Dividend yield 0.00 % December 31, 2017: Description Valuation technique Unobservable inputs Range Derivative warrant liabilities Black-Scholes-Merton Volatility 39.64 % Risk-free interest rate 1.88 % Expected term, in years 2.34 Dividend yield 0.00 % May 2018 Warrants September 30, 2018: Description Valuation technique Unobservable inputs Range Derivative warrant liabilities – A Warrants Black-Scholes-Merton Volatility 70.93 % Risk-free interest rate 2.96 % Expected term, in years 4.63 Dividend yield 0.00 % Description Valuation technique Unobservable inputs Range Derivative warrant liabilities – B Warrants Black-Scholes-Merton Volatility 113.31 % Risk-free interest rate 1.91 % Expected term, in years 0.12 Dividend yield 0.00 % May 17, 2018: Description Valuation technique Unobservable inputs Range Derivative warrant liabilities – A Warrants Black-Scholes-Merton Volatility 71.13 % Risk-free interest rate 2.98 % Expected term, in years 5.00 Dividend yield 0.00 % Description Valuation technique Unobservable inputs Range Derivative warrant liabilities – B Warrants Black-Scholes-Merton Volatility 72.88 % Risk-free interest rate 1.99 % Expected term, in years 0.50 Dividend yield 0.00 % |
Assets and Liabilities Measured at Fair Value on Nonrecurring Basis | The following table presents the placement in the fair value hierarchy of the Marathon Common Stock measured at fair value on a nonrecurring basis as of the Transaction Date: Fair value measurement at reporting date using Quoted prices in active markets Significant other Significant for identical observable unobservable Balance assets (Level 1) inputs (Level 2) inputs (Level 3) January 11, 2018 $ 450 $ — $ 450 $ — September 30, 2018 $ 43 $ 43 $ — $ — |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block] | The following table summarizes the changes in the Company’s investment in Marathon Common Stock, measured at fair value using significant other observable inputs (Level 2) as of Transaction Date and measured at fair value using quoted prices in active markets for identical assets (Level 1) during the three- and nine-month periods ended September 30, 2018: January 11, 2018 $ 450 Carrying value of Marathon Common Stock sold (274 ) Decrease in fair value of the Marathon Common Stock (133 ) September 30, 2018 $ 43 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Share-based Compensation [Abstract] | |
Schedule of Options Granted | The following table summarizes the RSUs granted to employees and consultants during the nine-month period ended September 30, 2018. Grant date No. of RSUs Fair market value at grant date Vesting term February 28, 2018 53,408 $ 0.94 Vesting immediately upon grant April 19, 2018 150,000 $ 0.60 Vesting immediately upon grant May 15, 2018 465,000 $ 0.60 Over one year, vesting on one-year anniversary of grant date |
Stock Options and Restricted Stock Units Activity | The activity related to RSUs and stock options during the nine-month period ended September 30, 2018 consisted of the following: RSUs Options No. of RSUs Weighted average grant date fair value No. of options Weighted average exercise price Exercise price range Weighted average grant date fair value Outstanding as of January 1, 2018 365,565 $ 2.12 4,317,942 $ 5.67 $ 1.10 – 41.00 $ 3.86 Granted 668,408 $ 0.63 — — — — Vested/Exercised (568,973 ) $ 1.61 — — — — Forfeited (10,000 ) $ 0.60 (1,980,625 ) $ 6.17 $ 1.55 – 37.20 $ 4.11 Expired — — (52,317 ) $ 16.24 $ 9.60 – 16.50 $ 9.71 Outstanding as of September 30, 2018 455,000 $ 0.60 2,285,000 $ 4.99 $ 1.10 – 41.00 $ 3.12 Exercisable as of September 30, 2018 — — 1,905,834 $ 5.59 $ 1.10 – 41.00 $ 3.53 |
Debt and Convertible Notes (Tab
Debt and Convertible Notes (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Convertible Debt Fair Value | The table below summarizes the initial fair value of the Convertible Notes and Warrants as of May 17, 2018: Class A Warrants $ 1,827 Class B Warrants 135 Convertible Notes 2,388 Total Fair Value $ 4,350 |
Schedule of Debt and Convertible Notes | The table below summarizes changes in the book value of the Convertible Notes from May 17, 2018 to September 30, 2018: Book value as of May 17, 2018 $ 2,388 Debt issuance costs (320 ) Book value as of May 17, 2018 2,068 Debt repayments in the period (649 ) Amortization of debt discount and debt issuance costs, included in interest expense 589 Book value as of September 30, 2018 $ 2,008 |
Discontinued Operations and A_2
Discontinued Operations and Assets and Liabilities Held for Disposal (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Disposal Groups, Including Discontinued Operations | The following table presents the components of the consolidated net loss from discontinued operations, as presented in the condensed consolidated statements of operations and comprehensive loss, for the three- and nine-month periods ended September 30, 2018 for Group Mobile and September 30, 2017 for Group Mobile and FLI Charge: Three months ended September 30, Nine months ended September 30, 2018 2017 2018 2017 Revenue $ — $ 4,889 $ 2,834 $ 11,883 Cost of sales — (3,918 ) (2,305 ) (9,603 ) Depreciation and amortization — (196 ) (131 ) (568 ) Impairment — — — (1,092 ) General and administrative — (1,463 ) (1,190 ) (5,079 ) Loss on disposal — — (301 ) — Non-operating income (expense), net — (11 ) (22 ) (15 ) Loss from discontinued operations before income taxes — (699 ) (1,115 ) (4,474 ) Income tax benefit (expense) — — — — Consolidated net loss from discontinued operations $ — $ (699 ) $ (1,115 ) $ (4,474 ) In addition, the following table presents the carrying amounts of Group Mobile’s major classes of assets and liabilities held for disposal as of September 30, 2018 and December 31, 2017, as presented in the condensed consolidated balance sheets: September 30, 2018 December 31, 2017 Cash $ — $ 150 Accounts receivable, net 109 2,920 Inventory — 1,935 Other current assets — 3 Property and equipment, net — 874 Intangible assets, net — 564 Assets held for disposal $ 109 $ 6,446 Accounts payable, accrued expenses and other current liabilities $ 40 $ 3,142 Deferred revenue — 619 Liabilities held for disposal $ 40 $ 3,761 |
General (Additional Information
General (Additional Information) (Details) - USD ($) $ / shares in Units, $ in Thousands | Nov. 12, 2018 | Aug. 14, 2018 | May 15, 2018 | May 31, 2018 | Sep. 30, 2018 | Jan. 05, 2018 | Dec. 31, 2017 | Sep. 30, 2017 | Dec. 31, 2016 |
Common Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 | $ 0.01 | ||||||
Assets, Current | $ 4,027 | $ 16,093 | |||||||
Debt Instrument, Face Amount | 6,500 | ||||||||
Cash and cash equivalents | 2,525 | 6,368 | $ 10,072 | $ 17,910 | |||||
Stock Issued During Period, Shares, New Issues | 3,578,630 | ||||||||
Liabilities, Current | 9,291 | 12,497 | |||||||
Proceeds From Convertible Note And Warrants Gross | $ 4,350 | ||||||||
Convertible Notes Payable, Current | 1,610 | $ 0 | |||||||
Non Cash Obligations | 1,661 | ||||||||
Long Term Liabilities | $ 465 | ||||||||
Private Placement [Member] | |||||||||
Stock Issued During Period, Value, New Issues | $ 88 | ||||||||
Convertible Common Stock [Member] | |||||||||
Stock Issued During Period, Shares, Conversion of Convertible Securities | 2,067 | 2,737 | |||||||
Accrued Interest on Convertible Notes | $ 351 | ||||||||
Subsequent Event [Member] | Series E Convertible Preferred Stock [Member] | |||||||||
Common Stock, Par or Stated Value Per Share | $ 0.01 | ||||||||
Stock Issued During Period, Shares, New Issues | 645,161 | ||||||||
Stock Issued During Period, Shares, Conversion of Convertible Securities | 3,225,806 | ||||||||
Conversion Price Per share | $ 0.62 | ||||||||
Proceeds from Issuance of Convertible Preferred Stock | $ 2,000 | ||||||||
Notes Payable, Other Payables [Member] | |||||||||
Debt Instrument, Convertible, Conversion Price | $ 0.62 | ||||||||
Convertible Notes Payable [Member] | |||||||||
Common Stock, Par or Stated Value Per Share | $ 0.01 | ||||||||
Debt Instrument, Face Amount | $ 4,438 | ||||||||
Debt Instrument, Interest Rate, Stated Percentage | 5.00% | ||||||||
Debt Instrument, Maturity Date, Description | November 16, 2019 | ||||||||
Convertible Notes Payable [Member] | Private Placement [Member] | |||||||||
Stock Issued During Period, Value, New Issues | $ 88 | ||||||||
Class A warrant [Member] | |||||||||
Shares Issued, Price Per Share | $ 0.62 | ||||||||
Class B warrant [Member] | |||||||||
Stock Issued During Period, Shares, New Issues | 7,157,259 | ||||||||
Shares Issued, Price Per Share | $ 0.62 |
Accounting and Reporting Poli_3
Accounting and Reporting Policies (Additional Information) (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Cost Method Investment Ownership Percentage | 20.00% |
Noncontrolling Interest [Member] | |
Cash | $ 1,081 |
Net Loss per Share of Common _3
Net Loss per Share of Common Stock (Computation of basic and diluted net losses per common share) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Earnings Per Share Disclosure [Line Items] | ||||
Net loss attributable to the Company | $ (3,187) | $ (4,697) | $ (30,643) | $ (18,132) |
Basic shares of common stock outstanding | 28,352,284 | 24,144,002 | 27,268,792 | 20,852,034 |
Basic and diluted net loss per share of common stock | $ (0.11) | $ (0.20) | $ (1.12) | $ (0.87) |
Net loss per share data presented excludes from the calculation of diluted net loss the following potentially dilutive securities, as they had an anti-dilutive impact: | ||||
Total number of potentially dilutive instruments, excluded from the calculation of net loss per share | 24,527,718 | 11,769,551 | 24,527,718 | 11,950,590 |
Basic and diluted numerator [Member] | ||||
Earnings Per Share Disclosure [Line Items] | ||||
Net loss from continuing operations attributable to shares of common stock | $ (3,187) | $ (3,998) | $ (29,528) | $ (13,658) |
Net loss from discontinued operations attributable to shares of common stock | 0 | (699) | (1,115) | (4,474) |
Net loss attributable to the Company | $ (3,187) | $ (4,697) | $ (30,643) | $ (18,132) |
Basic and diluted denominator [Member] | ||||
Earnings Per Share Disclosure [Line Items] | ||||
Basic shares of common stock outstanding | 28,352,284 | 24,144,002 | 27,268,792 | 20,852,034 |
Basic loss per share of common stock from continuing operations | $ (0.11) | $ (0.16) | $ (1.08) | $ (0.65) |
Basic loss per share of common stock from discontinued operations | 0 | (0.04) | (0.04) | (0.22) |
Basic and diluted net loss per share of common stock | $ (0.11) | $ (0.20) | $ (1.12) | $ (0.87) |
Preferred stock on an as converted basis [Member] | ||||
Net loss per share data presented excludes from the calculation of diluted net loss the following potentially dilutive securities, as they had an anti-dilutive impact: | ||||
Total number of potentially dilutive instruments, excluded from the calculation of net loss per share | 4,350,000 | 0 | 4,350,000 | 0 |
Vested and unvested options to purchase an equal number of shares of common stock of the Company [Member] | ||||
Net loss per share data presented excludes from the calculation of diluted net loss the following potentially dilutive securities, as they had an anti-dilutive impact: | ||||
Total number of potentially dilutive instruments, excluded from the calculation of net loss per share | 2,285,000 | 4,876,899 | 2,285,000 | 4,876,899 |
Unvested RSUs to issue an equal number of shares of common stock of the Company [Member] | ||||
Net loss per share data presented excludes from the calculation of diluted net loss the following potentially dilutive securities, as they had an anti-dilutive impact: | ||||
Total number of potentially dilutive instruments, excluded from the calculation of net loss per share | 455,000 | 365,565 | 455,000 | 365,565 |
Warrants to purchase an equal number of shares of common stock of the Company [Member] | ||||
Net loss per share data presented excludes from the calculation of diluted net loss the following potentially dilutive securities, as they had an anti-dilutive impact: | ||||
Total number of potentially dilutive instruments, excluded from the calculation of net loss per share | 14,073,390 | 3,087,500 | 14,073,390 | 3,087,500 |
Convertible notes on an as converted basis [Member] | ||||
Net loss per share data presented excludes from the calculation of diluted net loss the following potentially dilutive securities, as they had an anti-dilutive impact: | ||||
Total number of potentially dilutive instruments, excluded from the calculation of net loss per share | 3,364,328 | 3,439,587 | 3,364,328 | 3,620,626 |
Goodwill (Additional Informatio
Goodwill (Additional Information) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2018 | Mar. 29, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Jan. 02, 2018 | |
Opening Stock Price | $ 1.36 | |||||
Closing Stock Price | $ 0.72 | $ 1.45 | ||||
Average Stock Price | 1.02 | |||||
Goodwill, Impairment Loss | $ 0 | $ 0 | $ 19,630 | $ 0 | ||
Maximum Stock Price | 1.80 | |||||
Minimum Stock Price | $ 0.71 |
Other Assets (Additional Inform
Other Assets (Additional Information) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2018 | Jan. 31, 2018 | Dec. 31, 2017 | |
Cost Method Investments | $ 2,502 | $ 2,502 | $ 834 | |
Security Deposits | 854 | 854 | $ 852 | |
Route1 Inc. [Member] | ||||
Cost Method Investments | 1,625 | 1,625 | ||
InfoMedia Services Limited [Member] | ||||
Cost Method Investments | 787 | 787 | ||
Marathon Patent Group, Inc. [Member] | ||||
Cost Method Investments | 274 | 274 | $ 43 | |
Cost Method Investments, Fair Value Disclosure | $ 450 | |||
Cost-method Investments, Other than Temporary Impairment | $ 26 | 133 | ||
Cost Method Investments Number of Shares Sold | 200,046 | |||
Proceeds from Sale of Other Investments | $ 193 | |||
FLI Charge [Member] | ||||
Cost Method Investments | $ 47 | $ 47 |
Other Assets (Details)
Other Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Cost method investments | $ 2,502 | $ 834 |
Lease deposits | 854 | 852 |
Other assets | $ 3,356 | $ 1,686 |
Segment Information (Geographic
Segment Information (Geographical Revenue, Segment Operating Loss and Total Asset Information) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Revenue | |||||
Total revenue | $ 12,922 | $ 12,852 | $ 38,560 | $ 36,863 | |
Cost of sales | |||||
Total cost of sales | 9,985 | 10,473 | 30,121 | 29,926 | |
Segment operating income (loss) | |||||
Operating loss from continuing operations | (2,885) | (3,523) | (29,009) | (12,479) | |
Other non-operating expense, net | (246) | (265) | (335) | (566) | |
Loss from continuing operations before income taxes | (3,131) | (3,788) | (29,344) | (13,045) | |
Assets | |||||
Assets held for disposal | 109 | 109 | $ 6,446 | ||
Assets | 32,664 | 32,664 | 65,240 | ||
United States | |||||
Revenue | |||||
Total revenue | 11,516 | 11,349 | 34,513 | 32,982 | |
Cost of sales | |||||
Total cost of sales | 9,056 | 9,637 | 27,524 | 27,588 | |
Segment operating income (loss) | |||||
Operating loss from continuing operations | (3,095) | (4,052) | (29,470) | (13,704) | |
Assets | |||||
Assets | 29,878 | 29,878 | 55,152 | ||
All other countries | |||||
Revenue | |||||
Total revenue | 1,406 | 1,503 | 4,047 | 3,881 | |
Cost of sales | |||||
Total cost of sales | 929 | 836 | 2,597 | 2,338 | |
Segment operating income (loss) | |||||
Operating loss from continuing operations | 210 | $ 529 | 461 | $ 1,225 | |
Assets | |||||
Assets | $ 2,677 | $ 2,677 | $ 3,642 |
Fair Value Measurements (Additi
Fair Value Measurements (Additional Information) (Details) - USD ($) $ in Thousands | Jan. 11, 2018 | Sep. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Jan. 31, 2018 | Dec. 31, 2017 |
Proceeds from Sale of Intangible Assets | $ 250 | $ 150 | ||||
Noncash Merger Related Costs | 316 | |||||
Assets, Fair Value Disclosure | $ 450 | 450 | ||||
Cost Method Investments | 2,502 | 2,502 | $ 834 | |||
Assets Fair Value | $ 450 | $ 43 | $ 43 | |||
Common Stock Remaining Shares | 49,954 | 49,954 | ||||
Marathon Patent Group, Inc. [Member] | ||||||
Cost-method Investments, Other than Temporary Impairment | $ 26 | $ 133 | ||||
Cost Method Investments | 274 | 274 | $ 43 | |||
Assets Fair Value | 43 | $ 43 | ||||
Proceeds from Sale of Other Investments | $ 193 | |||||
Cost Method Investments Number of Shares Sold | 200,046 | |||||
Patent Rights Purchase and Assignment Agreement [Member] | ||||||
Proceeds from Sale of Intangible Assets | $ 250 | |||||
Marathon Common Stock [Member] | Patent Rights Purchase and Assignment Agreement [Member] | ||||||
Number of Shares Acquired Through Sale of Intangible Assets | 250,000 |
Fair Value Measurements (Assets
Fair Value Measurements (Assets and Liabilities Measured at Fair Value on Recurring Basis) (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | May 17, 2018 | Dec. 31, 2017 |
Liabilities | |||
Derivative liabilities | $ 455 | $ 1,962 | |
Warrant [Member] | |||
Liabilities | |||
Derivative liabilities | 1 | $ 34 | |
Class A Warrants [Member] | |||
Liabilities | |||
Derivative liabilities | 455 | 1,827 | |
Class B Warrants [Member] | |||
Liabilities | |||
Derivative liabilities | 0 | 135 | |
Fair Value, Inputs, Level 1 [Member] | |||
Liabilities | |||
Derivative liabilities | 0 | 0 | |
Fair Value, Inputs, Level 1 [Member] | Warrant [Member] | |||
Liabilities | |||
Derivative liabilities | 0 | 0 | |
Fair Value, Inputs, Level 1 [Member] | Class A Warrants [Member] | |||
Liabilities | |||
Derivative liabilities | 0 | 0 | |
Fair Value, Inputs, Level 1 [Member] | Class B Warrants [Member] | |||
Liabilities | |||
Derivative liabilities | 0 | 0 | |
Fair Value, Inputs, Level 2 [Member] | |||
Liabilities | |||
Derivative liabilities | 0 | 0 | |
Fair Value, Inputs, Level 2 [Member] | Warrant [Member] | |||
Liabilities | |||
Derivative liabilities | 0 | 0 | |
Fair Value, Inputs, Level 2 [Member] | Class A Warrants [Member] | |||
Liabilities | |||
Derivative liabilities | 0 | 0 | |
Fair Value, Inputs, Level 2 [Member] | Class B Warrants [Member] | |||
Liabilities | |||
Derivative liabilities | 0 | 0 | |
Fair Value, Inputs, Level 3 [Member] | |||
Liabilities | |||
Derivative liabilities | 455 | 1,962 | |
Fair Value, Inputs, Level 3 [Member] | Warrant [Member] | |||
Liabilities | |||
Derivative liabilities | 1 | $ 34 | |
Fair Value, Inputs, Level 3 [Member] | Class A Warrants [Member] | |||
Liabilities | |||
Derivative liabilities | 455 | 1,827 | |
Fair Value, Inputs, Level 3 [Member] | Class B Warrants [Member] | |||
Liabilities | |||
Derivative liabilities | $ 0 | $ 135 |
Fair Value Measurements (Change
Fair Value Measurements (Changes In Company's Liabilities Measured At Fair Value Using Significant Unobservable Inputs) (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Derivative Liability, Ending | $ 455 |
May Twenty Fifteen Warrants [Member] | |
Derivative Liability, Beginning | 34 |
Issuance of warrants May 17, 2018 | 1,962 |
Decrease in fair value of the derivative warrant liabilities | (1,541) |
Derivative Liability, Ending | $ 455 |
Fair Value Measurements (Based
Fair Value Measurements (Based Upon Sensitivity and Nature of Inputs) (Details) - Derivative Warrant Liabilities [Member] | 1 Months Ended | 9 Months Ended | 12 Months Ended |
May 17, 2018 | Sep. 30, 2018 | Dec. 31, 2017 | |
Measurement Input, Price Volatility [Member] | |||
Fair Values Inputs Liabilities Quantitative Information Line Items [Line Items] | |||
Fair Value Assumptions Rate | 70.37% | 39.64% | |
Measurement Input, Risk Free Interest Rate [Member] | |||
Fair Values Inputs Liabilities Quantitative Information Line Items [Line Items] | |||
Fair Value Assumptions Rate | 2.72% | 1.88% | |
Measurement Input, Expected Term [Member] | |||
Fair Values Inputs Liabilities Quantitative Information Line Items [Line Items] | |||
Fair Value Assumptions Term | 1 year 7 months 2 days | 2 years 4 months 2 days | |
Measurement Input, Expected Dividend Rate [Member] | |||
Fair Values Inputs Liabilities Quantitative Information Line Items [Line Items] | |||
Fair Value Assumptions Rate | 0.00% | 0.00% | |
Class A Warrants [Member] | Measurement Input, Price Volatility [Member] | |||
Fair Values Inputs Liabilities Quantitative Information Line Items [Line Items] | |||
Fair Value Assumptions Rate | 71.13% | 70.93% | |
Class A Warrants [Member] | Measurement Input, Risk Free Interest Rate [Member] | |||
Fair Values Inputs Liabilities Quantitative Information Line Items [Line Items] | |||
Fair Value Assumptions Rate | 2.98% | 2.96% | |
Class A Warrants [Member] | Measurement Input, Expected Term [Member] | |||
Fair Values Inputs Liabilities Quantitative Information Line Items [Line Items] | |||
Fair Value Assumptions Term | 5 years | 4 years 7 months 17 days | |
Class A Warrants [Member] | Measurement Input, Expected Dividend Rate [Member] | |||
Fair Values Inputs Liabilities Quantitative Information Line Items [Line Items] | |||
Fair Value Assumptions Rate | 0.00% | 0.00% | |
Class B Warrants [Member] | Measurement Input, Price Volatility [Member] | |||
Fair Values Inputs Liabilities Quantitative Information Line Items [Line Items] | |||
Fair Value Assumptions Rate | 72.88% | 113.31% | |
Class B Warrants [Member] | Measurement Input, Risk Free Interest Rate [Member] | |||
Fair Values Inputs Liabilities Quantitative Information Line Items [Line Items] | |||
Fair Value Assumptions Rate | 1.99% | 1.91% | |
Class B Warrants [Member] | Measurement Input, Expected Term [Member] | |||
Fair Values Inputs Liabilities Quantitative Information Line Items [Line Items] | |||
Fair Value Assumptions Term | 6 months | 1 month 13 days | |
Class B Warrants [Member] | Measurement Input, Expected Dividend Rate [Member] | |||
Fair Values Inputs Liabilities Quantitative Information Line Items [Line Items] | |||
Fair Value Assumptions Rate | 0.00% | 0.00% |
Fair Value Measurements (Intang
Fair Value Measurements (Intangible Assets Measured At Fair Value On A Non-Recurring Basis) (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Jan. 11, 2018 |
Fair Values Assets And Liabilities Measured On Recurring And Nonrecurring Basis Alternative [Abstract] | ||
Assets Fair Value | $ 43 | $ 450 |
Fair Value, Inputs, Level 1 [Member] | ||
Fair Values Assets And Liabilities Measured On Recurring And Nonrecurring Basis Alternative [Abstract] | ||
Assets Fair Value | 43 | 0 |
Fair Value, Inputs, Level 2 [Member] | ||
Fair Values Assets And Liabilities Measured On Recurring And Nonrecurring Basis Alternative [Abstract] | ||
Assets Fair Value | 0 | 450 |
Fair Value, Inputs, Level 3 [Member] | ||
Fair Values Assets And Liabilities Measured On Recurring And Nonrecurring Basis Alternative [Abstract] | ||
Assets Fair Value | $ 0 | $ 0 |
Fair Value Measurements (chan_2
Fair Value Measurements (changes in the Company's investment) (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2018USD ($) | |
January 11, 2018 | $ 450 |
Carrying value of Marathon Common Stock sold | (274) |
Decrease in fair value of the Marathon Common Stock | (133) |
September 30, 2018 | $ 43 |
Stock-Based Compensation (Addit
Stock-Based Compensation (Additional Information) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Stockholders Equity [Line Items] | ||||
Share-Based Compensation | $ 194 | $ 706 | $ 765 | $ 1,752 |
Discontinued Operations [Member] | ||||
Stockholders Equity [Line Items] | ||||
Share-Based Compensation | $ 44 | $ 427 | ||
Two Thousand Twelve Stock Option Plan [Member] | ||||
Stockholders Equity [Line Items] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 3,358,470 | 3,358,470 |
Stock-Based Compensation (Sched
Stock-Based Compensation (Schedule Of Common Stock Options Granted) (Details) | 9 Months Ended |
Sep. 30, 2018$ / sharesshares | |
Consultant [Member] | |
Stockholders Equity [Line Items] | |
Grant date | February 28, 2018 |
No. of RSUs Options | shares | 53,408 |
Fair market value at grant date | $ / shares | $ 0.94 |
Vesting terms | Vesting immediately upon grant |
Consultant One [Member] | |
Stockholders Equity [Line Items] | |
Grant date | April 19, 2018 |
No. of RSUs Options | shares | 150,000 |
Fair market value at grant date | $ / shares | $ 0.60 |
Vesting terms | Vesting immediately upon grant |
Consultant Two [Member] | |
Stockholders Equity [Line Items] | |
Grant date | May 15, 2018 |
No. of RSUs Options | shares | 465,000 |
Fair market value at grant date | $ / shares | $ 0.60 |
Vesting terms | Over one year, vesting on one-year anniversary of grant date |
Stock-Based Compensation (Stock
Stock-Based Compensation (Stock options and RSU activity) (Details) | 9 Months Ended |
Sep. 30, 2018$ / sharesshares | |
Employee Stock Option [Member] | |
Stockholders Equity [Line Items] | |
No. of options, Outstanding | shares | 4,317,942 |
No. of options, Granted | shares | 0 |
No. of options, Vested/Exercised | shares | 0 |
No. of options, Forfeited | shares | (1,980,625) |
No. of options, Expired | shares | (52,317) |
No. of options, Outstanding | shares | 2,285,000 |
No. of options, Exercisable | shares | 1,905,834 |
Exercise price range, Outstanding | $ 5.67 |
Exercise price range, Granted | 0 |
Exercise price range, Vested/Exercised | 0 |
Exercise price range, Forfeited | 6.17 |
Exercise price range, Expired | 16.24 |
Exercise price range, Outstanding | 4.99 |
Exercise price range, Exercisable | 5.59 |
Weighted average grant date fair value, Outstanding | 3.86 |
Weighted average grant date fair value, Granted | 0 |
Weighted average grant date fair value, Vested/Exercised | 0 |
Weighted average grant date fair value, Forfeited | 4.11 |
Weighted average grant date fair value, Expired | 9.71 |
Weighted average grant date fair value, Outstanding | 3.12 |
Weighted average grant date fair value, Exercisable | $ 3.53 |
Restricted Stock Units (RSUs) [Member] | |
Stockholders Equity [Line Items] | |
No. of RSUS, Outstanding | shares | 365,565 |
No. of RSUs, Granted | shares | 668,408 |
No. of RSUs, Vested/Exercised | shares | (568,973) |
No. of RSUs, Forfeited | shares | (10,000) |
No. of RSUs, Expired | shares | 0 |
No. of RSUS, Outstanding | shares | 455,000 |
No. of RSUs, Exercisable | shares | 0 |
Weighted average grant date fair value, Outstanding | $ 2.12 |
Weighted average grant date fair value, Granted | 0.63 |
Weighted average grant date fair value, Vested/Exercised | 1.61 |
Weighted average grant date fair value, Forfeited | 0.60 |
Weighted average grant date fair value, Expired | 0 |
Weighted average grant date fair value, Outstanding | 0.60 |
Weighted average grant date fair value, Exercisable | 0 |
Minimum [Member] | Employee Stock Option [Member] | |
Stockholders Equity [Line Items] | |
Exercise price range, Outstanding | 1.10 |
Exercise price range, Forfeited | 1.55 |
Exercise price range, Expired | 9.60 |
Exercise price range, Outstanding | 1.10 |
Exercise price range, Exercisable | 1.10 |
Maximum [Member] | Employee Stock Option [Member] | |
Stockholders Equity [Line Items] | |
Exercise price range, Outstanding | 41 |
Exercise price range, Forfeited | 37.20 |
Exercise price range, Expired | 16.50 |
Exercise price range, Outstanding | 41 |
Exercise price range, Exercisable | $ 41 |
Debt and Convertible Notes (Add
Debt and Convertible Notes (Additional Information) (Details) - USD ($) $ / shares in Units, $ in Thousands | Aug. 14, 2018 | May 15, 2018 | Sep. 17, 2018 | Sep. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2018 | Dec. 31, 2017 |
Debt Instrument, Face Amount | $ 6,500 | ||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 30,000,000 | 30,000,000 | 30,000,000 | ||||
Amortization of Debt Discount (Premium) | $ 589 | ||||||
Private Placement [Member] | |||||||
Stock Issued During Period, Value, New Issues | $ 88 | ||||||
Convertible Debt [Member] | |||||||
Debt Instrument, Face Amount | $ 4,438 | ||||||
Interest Expense, Debt | $ 48 | $ 75 | |||||
Debt Instrument, Interest Rate, Stated Percentage | 5.00% | ||||||
Debt Instrument, Convertible, Conversion Price | $ 0.62 | ||||||
Debt Instrument, Periodic Payment | $ 296 | ||||||
Common Stock Discount Percentage | 10.00% | ||||||
Minimum Floor Price Percentage | 20.00% | ||||||
Early Repayment Penalties Rate | 15.00% | ||||||
Amortization of Debt Discount (Premium) | 394 | $ 589 | |||||
Class B warrant [Member] | Convertible Debt [Member] | |||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 0.62 | ||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 3,578,630 | ||||||
Class A Warrant [Member] | |||||||
Class of Warrant or Right Number of Warrants Issued | 250,000 | ||||||
Class A Warrant [Member] | Convertible Debt [Member] | |||||||
Debt Instrument, Convertible, Conversion Price | $ 0.62 | ||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 7,157,259 | ||||||
XpresSpa Engagement [Member] | |||||||
Debt Instrument, Face Amount | $ 6,500 | $ 6,500 | $ 6,500 | ||||
Payments For Interest Expenses | 580 | ||||||
Interest Expense, Debt | $ 548 | ||||||
Debt Instrument, Maturity Date Range, Start | May 1, 2019 | ||||||
Debt Instrument, Maturity Date Range, End | Dec. 31, 2019 | ||||||
Convertible Common Stock [Member] | |||||||
Accrued Interest on Convertible Notes | $ 351 | ||||||
Stock Issued During Period, Shares, Conversion of Convertible Securities | 2,067 | 2,737 |
Debt and Convertible Notes (Fai
Debt and Convertible Notes (Fair Value Of Convertible Note) (Details) $ in Thousands | May 17, 2018USD ($) |
Convertible Debt, Fair Value Disclosures | $ 4,350 |
Class A Warrants [Member] | |
Convertible Debt, Fair Value Disclosures | 1,827 |
Class B Warrants [Member] | |
Convertible Debt, Fair Value Disclosures | 135 |
Convertible Notes [Member] | |
Convertible Debt, Fair Value Disclosures | $ 2,388 |
Debt and Convertible Notes (Det
Debt and Convertible Notes (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 4 Months Ended |
May 17, 2018 | Sep. 30, 2018 | Sep. 30, 2018 | |
Book value as of Balance Beggining | $ 2,388 | $ 2,068 | |
Debt issuance costs | (320) | ||
Debt repayments in the period | $ (649) | (649) | |
Amortization of debt discount and debt issuance costs, included in interest expense | 589 | ||
Book value as of Ending Balance | $ 2,068 | $ 2,008 | $ 2,008 |
Related Party Transactions (Add
Related Party Transactions (Additional Information) (Details) - Consulting Agreement [Member] - Mistral Equity Partners [Member] - USD ($) $ in Thousands | Apr. 14, 2018 | Sep. 30, 2018 | Sep. 30, 2018 |
Related Party Transaction, Amounts of Transaction | $ 10 | ||
Related Party Consulting Expense | $ 30 | $ 55 |
Discontinued Operations and A_3
Discontinued Operations and Assets and Liabilities Held for Disposal (Additional Information) (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2017 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Disposal Group, Including Discontinued Operation, Consideration | $ 1,625 | |
Disposal Group Including Discontinued Operation Consideration Shares Received | 25,000,000 | |
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 30,000,000 | |
Disposal Group, Including Discontinued Operation, Post Closing, Description | Post-closing, the Company owned approximately 6.7% of Route1 Common Stock. The Route1 Common Stock is not tradable until a date no earlier than 12 months after the Closing Date; 50%, or 12,500,000 shares, of Route1 Common Stock are tradeable after 12 months plus an additional 2,083,333 shares of Route1 Common Stock are tradeable each month until 18 months after the Closing Date, subject to a change of control provision. The Company has the ability to sell the Route1 Common Stock and warrants to qualified institutional investors. The Group Mobile Purchase Agreement also contains representations, warranties, and covenants customary for transactions of this type. | |
Proceeds from Sale of Inventory, Discontinued Operations | $ 110 | |
Disposal Group, Including Discontinued Operation, Accounts, Notes and Loans Receivable, Net | 109 | $ 2,920 |
Discontinued Operation, Gain (Loss) on Disposal of Discontinued Operation, Net of Tax | 301 | |
Disposal Group, Discontinued Operation, Value of Common Stock | 308 | |
Disposal Group, Discontinued Operation, Value of Warrants | 176 | |
Disposal Group, Discontinued Operation, Value of Earn-Out Provision | $ 1,141 | |
Discontinued Operations [Member] | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Disposal Group Including Discontinued Operation Shares Acquired Lockup Description | Post-closing, the Company owned approximately 6.7% of Route1 Common Stock. The Route1 Common Stock is not tradable until a date no earlier than 12 months after the Closing Date; 50%, or 12,500,000 shares, of Route1 Common Stock are tradeable after 12 months plus an additional 2,083,333 shares of Route1 Common Stock are tradeable each month until 18 months after the Closing Date, subject to a change of control provision. | |
Disposal Group, Including Discontinued Operation, Inventory | $ 555 |
Discontinued Operations and A_4
Discontinued Operations and Assets and Liabilities Held for Disposal (Schedule Of Discontinued Operations, As Presented In Consolidated Statements Of Operations) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Revenue | $ 0 | $ 4,889 | $ 2,834 | $ 11,883 |
Cost of sales | 0 | (3,918) | (2,305) | (9,603) |
Depreciation and amortization | 0 | (196) | (131) | (568) |
Impairment | 0 | 0 | 0 | (1,092) |
General and administrative | 0 | (1,463) | (1,190) | (5,079) |
Loss on disposal | 0 | 0 | (301) | 0 |
Non-operating income (expense), net | 0 | (11) | (22) | (15) |
Loss from discontinued operations before income taxes | 0 | (699) | (1,115) | (4,474) |
Income tax benefit (expense) | 0 | 0 | 0 | 0 |
Consolidated net loss from discontinued operations | $ 0 | $ (699) | $ (1,115) | $ (4,474) |
Discontinued Operations and A_5
Discontinued Operations and Assets and Liabilities Held for Disposal (Carrying Amounts Of the Major Classes Of Assets and Liabilities) (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Cash | $ 0 | $ 150 |
Accounts receivable, net | 109 | 2,920 |
Inventory | 0 | 1,935 |
Other current assets | 0 | 3 |
Property and equipment, net | 0 | 874 |
Intangible assets, net | 0 | 564 |
Assets held for disposal | 109 | 6,446 |
Accounts payable, accrued expenses and other current liabilities | 40 | 3,142 |
Deferred revenue | 0 | 619 |
Liabilities held for disposal | $ 40 | $ 3,761 |
Income Taxes (Additional Inform
Income Taxes (Additional Information) (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Income Taxes [Line Items] | |
Business Acquisition, Goodwill, Expected Tax Deductible Amount | $ 198 |
Effective Income Tax Rate Discontinued Operations | 0.44% |
Commitments and Contingencies (
Commitments and Contingencies (Additional Information) (Details) $ in Thousands | Sep. 30, 2018USD ($) |
Accrued Liabilities [Member] | |
Loss Contingencies [Line Items] | |
Estimated Litigation Liability, Current | $ 290 |
Subsequent Events (Additional I
Subsequent Events (Additional Information) (Details) - USD ($) $ / shares in Units, $ in Thousands | Nov. 12, 2018 | May 15, 2018 | Dec. 31, 2018 | Nov. 13, 2018 | Sep. 30, 2018 | Jan. 05, 2018 | Dec. 31, 2017 |
Subsequent Event [Line Items] | |||||||
Stock Issued During Period, Shares, New Issues | 3,578,630 | ||||||
Common Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 | $ 0.01 | ||||
Series E Convertible Preferred Stock [Member] | Scenario, Forecast [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Conversion Price Per share | $ 0.62 | ||||||
Sale of Stock, Number of Shares Issued in Transaction | 322,581 | ||||||
Conversion of Stock, Shares Issued | 1,612,905 | ||||||
Proceeds From Additional Issuance Of Convertible Preference Shares | $ 1,000,000 | ||||||
Subsequent Event [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Bases Shares Issuable Description | an additional number of shares of Common Stock (the “Premium Shares”), calculated as follows: (i) if the Base Price is greater than $9.00, no Premium Shares shall be issued, (ii) if the Base Price is greater than $7.00 and equal to or less than $9.00, an additional number of shares equal to 5% of the Base Shares shall be issued, (iii) if the Base Price is greater than $6.00 and equal to or less than $7.00, an additional number of shares equal to 10% of the Base Shares shall be issued, (iv) if the Base Price is greater than $5.00 and equal to or less than $6.00, an additional number of shares equal to 20% of the Base Shares shall be issued and (v) if the Base Price is less than or equal to $5.00, an additional number of shares equal to 25% of the Base Shares shall be issued | ||||||
Effect Of Reduction Of Volume Weighted Average Price | Accordingly, if the volume weighted average price per share of Common Stock is below $9.00 per share at the time of repayment and the Company exercises the option to make such repayment in shares of Common Stock, a large number of shares of Common Stock may be issued to the holders of Series E Preferred Stock upon maturity, which may have a negative effect on the trading price of Common Stock. | ||||||
Volume Weighted Average Price Description | VWAP per share of Common Stock be determined to be less than $0.62. | ||||||
Preferred Stock, Shares Authorized | 1,473,300 | ||||||
Subsequent Event [Member] | Series E Convertible Preferred Stock [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Stock Issued During Period, Shares, Conversion of Convertible Securities | 3,225,806 | ||||||
Stock Issued During Period, Shares, New Issues | 645,161 | ||||||
Preferred Stock, Par or Stated Value Per Share | $ 0.01 | ||||||
Common Stock, Par or Stated Value Per Share | 0.01 | ||||||
Conversion Price Per share | 0.62 | ||||||
Sale of Stock, Price Per Share | $ 3.10 | ||||||
Proceeds from Issuance of Convertible Preferred Stock | $ 2,000 | ||||||
Preferred Stock, Liquidation Preference, Value | 2,000,000 | ||||||
Subsequent Event [Member] | Series E Convertible Preferred Stock [Member] | Share-based Compensation Award, Tranche One [Member] | |||||||
Subsequent Event [Line Items] | |||||||
Preferred Stock, Liquidation Preference, Value | $ 3,000,000 |