Document and Entity Information
Document and Entity Information - USD ($) | 9 Months Ended | ||
Dec. 31, 2015 | Mar. 15, 2016 | Sep. 30, 2015 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | COGENTIX MEDICAL INC /DE/ | ||
Entity Central Index Key | 894,237 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Public Float | $ 26,692,079 | ||
Entity Common Stock, Shares Outstanding | 25,975,617 | ||
Document Fiscal Year Focus | 2,015 | ||
Document Fiscal Period Focus | FY | ||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2015 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2015 | Mar. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 1,976,594 | $ 9,261,903 |
Accounts receivable, net | 8,191,391 | 7,306,653 |
Inventories | 4,584,844 | 4,825,984 |
Other | 834,076 | 749,466 |
Total current assets | 15,586,905 | 22,144,006 |
Property, plant, and equipment, net | 2,554,822 | 1,813,343 |
Goodwill | 18,749,888 | 18,749,888 |
Other intangibles, net | 11,846,009 | 13,748,582 |
Deferred tax assets and other | 269,121 | 296,860 |
Total assets | 49,006,745 | 56,752,679 |
Current liabilities: | ||
Accounts payable | 2,209,473 | 3,967,975 |
Income tax payable | 20,866 | 25,998 |
Accrued liabilities: | ||
Compensation | 3,281,809 | 3,285,952 |
Other | 949,497 | 2,450,058 |
Total current liabilities | 6,461,645 | 9,729,983 |
Convertible debt - related party, net | 23,336,854 | 22,529,497 |
Interest payable | 757,615 | 523,743 |
Accrued pension liability | 663,071 | 955,780 |
Deferred rent | 671,088 | 0 |
Other | 157,453 | 265,766 |
Total liabilities | $ 32,047,726 | $ 34,004,769 |
Commitments and contingencies | ||
Shareholders' equity: | ||
Common stock $.01 par value; 100,000,000 shares authorized, 26,057,327 and 25,676,212 shares issued and outstanding at December 31, 2015 and March 31, 2015, respectively | $ 260,574 | $ 256,763 |
Additional paid-in capital | 76,485,650 | 75,530,641 |
Accumulated deficit | (58,910,707) | (51,883,229) |
Accumulated other comprehensive loss | (876,498) | (1,156,265) |
Total shareholders' equity | 16,959,019 | 22,747,910 |
Total liabilities and shareholders' equity | $ 49,006,745 | $ 56,752,679 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2015 | Mar. 31, 2015 |
Shareholders' equity | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 26,057,327 | 25,676,212 |
Common stock, shares outstanding (in shares) | 26,057,327 | 25,676,212 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 9 Months Ended | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | |
CONSOLIDATED STATEMENTS OF OPERATIONS [Abstract] | ||||
Net sales | $ 36,622,355 | $ 19,506,164 | $ 26,525,975 | $ 24,577,126 |
Cost of goods sold | 12,519,443 | 2,322,942 | 3,124,710 | 3,049,811 |
Gross profit | 24,102,912 | 17,183,222 | 23,401,265 | 21,527,315 |
Operating expenses | ||||
General and administrative | 5,530,909 | 5,148,998 | 5,751,053 | 6,522,389 |
Research and development | 3,168,753 | 2,226,018 | 2,833,112 | 2,151,257 |
Selling and marketing | 18,484,063 | 15,107,241 | 20,037,069 | 18,121,732 |
Merger related costs | 950,469 | 0 | 2,395,979 | 0 |
Amortization of intangibles | 1,902,573 | 24,136 | 31,398 | 30,462 |
Total operating expenses | 30,036,767 | 22,506,393 | 31,048,611 | 26,825,840 |
Operating loss | (5,933,855) | (5,323,171) | (7,647,346) | (5,298,525) |
Other income (expense) | ||||
Interest income | 3,337 | 6,606 | 8,464 | 22,095 |
Interest expense | (1,071,441) | (250) | (489) | 0 |
Foreign currency exchange gain (loss) | 14,313 | (3,317) | (4,281) | (4,761) |
Total other income (expense) | (1,053,791) | 3,039 | 3,694 | 17,334 |
Loss before income taxes | (6,987,646) | (5,320,132) | (7,643,652) | (5,281,191) |
Income tax expense | 39,832 | 55,785 | 65,506 | 71,899 |
Net loss | $ (7,027,478) | $ (5,375,917) | $ (7,709,158) | $ (5,353,090) |
Basic and diluted net loss per common share (in dollars per share) | $ (0.28) | $ (0.34) | $ (0.49) | $ (0.35) |
Weighted average common shares outstanding: | ||||
Basic and diluted (in shares) | 25,377,955 | 15,755,950 | 15,753,157 | 15,344,949 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) | 9 Months Ended | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS [Abstract] | ||||
Net loss | $ (7,027,478) | $ (5,375,917) | $ (7,709,158) | $ (5,353,090) |
Other comprehensive income (loss), net of tax: | ||||
Foreign currency translation adjustments | (16,449) | (221,689) | (401,449) | 133,810 |
Unrealized (loss) gain on available-for-sale investments | 0 | (775) | (775) | 1,111 |
Pension adjustments | 296,216 | 40,591 | (269,646) | (50,139) |
Total other comprehensive income (loss), net of tax | 279,767 | (181,873) | (671,870) | 84,782 |
Comprehensive loss | $ (6,747,711) | $ (5,557,790) | $ (8,381,028) | $ (5,268,308) |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Total |
Balance at Mar. 31, 2013 | $ 152,631 | $ 55,923,763 | $ (38,820,981) | $ (569,177) | $ 16,686,236 |
Balance (in shares) at Mar. 31, 2013 | 15,263,075 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Share-based compensation expense | $ 2,322 | 1,433,948 | 0 | 0 | 1,436,270 |
Share-based compensation expense (in shares) | 232,242 | ||||
Proceeds from exercise of stock options, net of shares exchanged | $ 2,388 | 357,114 | 0 | 0 | 359,502 |
Proceeds from exercise of stock options, net of shares exchanged (in shares) | 238,791 | ||||
Comprehensive loss | $ 0 | 0 | (5,353,090) | 84,782 | (5,268,308) |
Balance at Mar. 31, 2014 | $ 157,342 | 57,714,824 | (44,174,071) | (484,395) | 13,213,700 |
Balance (in shares) at Mar. 31, 2014 | 15,734,108 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Share-based compensation expense | $ 2,935 | 1,386,234 | 0 | 0 | 1,389,169 |
Share-based compensation expense (in shares) | 293,528 | ||||
Issuance of shares from merger | $ 95,895 | 16,373,164 | 0 | 0 | 16,469,059 |
Issuance of shares from merger (in shares) | 9,589,524 | ||||
Proceeds from exercise of stock options, net of shares exchanged | $ 591 | 56,419 | 0 | 0 | 57,010 |
Proceeds from exercise of stock options, net of shares exchanged (in shares) | 59,052 | ||||
Comprehensive loss | $ 0 | 0 | (7,709,158) | (671,870) | (8,381,028) |
Balance at Mar. 31, 2015 | $ 256,763 | 75,530,641 | (51,883,229) | (1,156,265) | 22,747,910 |
Balance (in shares) at Mar. 31, 2015 | 25,676,212 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Share-based compensation expense | $ 4,915 | 974,037 | 0 | 0 | 978,952 |
Share-based compensation expense (in shares) | 491,522 | ||||
Shares exchanged in lieu of taxes | $ (1,104) | (19,028) | 0 | 0 | (20,132) |
Shares exchanged in lieu of taxes (in shares) | (110,407) | ||||
Comprehensive loss | $ 0 | 0 | (7,027,478) | 279,767 | (6,747,711) |
Balance at Dec. 31, 2015 | $ 260,574 | $ 76,485,650 | $ (58,910,707) | $ (876,498) | $ 16,959,019 |
Balance (in shares) at Dec. 31, 2015 | 26,057,327 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 9 Months Ended | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | |
Cash flows from operating activities: | ||||
Net loss | $ (7,027,478) | $ (5,375,917) | $ (7,709,158) | $ (5,353,090) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||||
Depreciation and amortization | 2,569,636 | 207,011 | 278,953 | 353,238 |
Loss (gain) on disposal of equipment | 4,859 | 161 | 38,613 | (2,872) |
Amortization of premium on marketable securities | 0 | 311 | 311 | 8,341 |
Share-based compensation expense | 978,952 | 1,077,928 | 1,389,169 | 1,436,270 |
Amortization of discount on related party debt | 807,356 | 0 | 0 | 0 |
Long term incentive plan | (78,188) | 131,907 | 152,592 | 0 |
Tax expense (benefit) | 65,799 | 5,129 | (83,402) | 6,498 |
Deferred rent | 636,615 | 23,556 | 23,962 | (37,055) |
Restricted stock exchanged for taxes | (20,132) | 0 | 0 | 0 |
Changes in operating assets and liabilities, net of merger: | ||||
Accounts receivable | (1,663,510) | 220,002 | (337,842) | (257,794) |
Inventories | 246,273 | 73,626 | 140,610 | 207,046 |
Other current assets | 696,742 | 48,142 | 121,688 | 76,092 |
Accounts payable | (1,759,500) | 295,113 | 231,663 | 281,104 |
Interest payable | 233,873 | 0 | 0 | 0 |
Accrued compensation | (4,579) | 212,259 | 635,892 | 436,765 |
Accrued liabilities, other | (1,666,431) | (59,459) | 674,283 | (5,721) |
Accrued pension liability, net | (29,940) | (56,226) | 78,043 | (51,000) |
Deferred revenue | 154,684 | 0 | 0 | 0 |
Net cash used in operating activities | (5,854,969) | (3,196,457) | (4,364,623) | (2,902,178) |
Cash flows from investing activities: | ||||
Proceeds from maturity of available-for-sale instruments | 0 | 3,450,000 | 3,450,000 | 7,930,000 |
Cash acquired from merger with Vision-Sciences | 0 | 0 | 2,019,610 | 0 |
Purchases of property, plant and equipment | (1,411,042) | (206,498) | (420,726) | (248,105) |
Proceeds from sale of property, plant and equipment | 3,104 | 4,103 | 6,773 | |
Payments for intangible assets | 0 | 0 | 0 | (49,940) |
Net cash (used in) provided by investing activities | (1,411,042) | 3,246,606 | 5,052,987 | 7,638,728 |
Cash flows from financing activities: | ||||
Proceeds from exercise of stock options | 0 | 67,850 | 67,850 | 359,510 |
Net cash provided by financing activities | 0 | 67,850 | 67,850 | 359,510 |
Effect of exchange rates on cash and cash equivalents | (19,298) | (95,819) | (175,921) | 51,686 |
Net (decrease) increase in cash and cash equivalents | (7,285,309) | 22,180 | 580,293 | 5,147,746 |
Cash and cash equivalents at beginning of period | 9,261,903 | 8,681,610 | 8,681,610 | 3,533,864 |
Cash and cash equivalents at end of period | 1,976,594 | 8,703,790 | 9,261,903 | 8,681,610 |
Supplemental disclosure of cash flow information: | ||||
Cash paid during the period for income tax | 39,832 | 56,144 | 65,504 | 71,899 |
Cash paid during the period for interest | $ 30,213 | $ 0 | $ 0 | $ 0 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Dec. 31, 2015 | |
Summary of Significant Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 1: Summary of Significant Accounting Policies Nature of Business. Cogentix Medical, Inc., headquartered in Minnetonka, Minnesota, with additional operations in New York, Massachusetts, The Netherlands and the United Kingdom, is a global medical device company. We design, develop, manufacture and market innovative proprietary technologies serving the urology, urogynecology/gyn, ENT (ear, nose and throat) and gastrointestinal markets. The Urgent® PC Neuromodulation System delivers percutaneous tibial nerve stimulation (PTNS) which has FDA clearance for the office-based treatment of overactive bladder (OAB) and has regulatory approvals for the treatment of OAB and fecal incontinence (FI) in various international markets. The FDA-cleared and CE marked PrimeSight Endoscopy Systems and EndoSheath Protective Barrier combine state-of-the-art endoscopic technology with a sterile, disposable microbial barrier, providing practitioners and healthcare facilities with a solution to meet the growing need for safe, efficient and cost-effective flexible endoscopy. The Company also offers Macroplastique®, a urethral bulking agent for the treatment of stress urinary incontinence. Outside the U.S., the Company markets additional bulking agents: PTQ ® ® The Company is the result of the Merger effective as of March 31, 2015, of two medical device companies, Uroplasty, Inc. (“UPI”) and Vision-Sciences, Inc. (“VSCI”). On the effective date of the Merger, the two companies completed an all-stock merger, pursuant to which UPI merged with and into Merger Sub, a wholly owned subsidiary of VSCI. Merger Sub was the surviving company from the Merger, and changed its name to Uroplasty, LLC. VSCI continued to be the sole member of the surviving company. After the merger, VSCI and its consolidated subsidiaries, including the surviving company, operate under the name Cogentix Medical, Inc. Upon closing of the Merger, the former UPI stockholders owned approximately 62.5% and the VSCI shareholders retained approximately 37.5% of the Company. Accordingly, while VSCI was the legal acquirer and issued its shares in the Merger, UPI is the acquiring company in the Merger for accounting purposes and the Merger has been accounted for as a reverse acquisition under the acquisition method of accounting for business combinations. As a result, the financial statements of the Company prior to the effective date of the Merger are the historical financial statements of UPI, whereas the financial statements of the Company after the effective date of the Merger reflect the results of the operations of UPI and VSCI on a combined basis. See additional disclosure provided in Note 2. All share amounts and price per share amounts for all periods presented relate to VSCI shares with UPI shares and price per share converted to VSCI amounts based on the conversion ratio in the acquisition agreement and the one for five reverse stock split. Change in Fiscal Year. On December 10, 2015, the Board of Directors of the Company determined that, in accordance with its bylaws and upon recommendation of the Audit Committee, the Company’s fiscal year shall begin on January 1 and end on December 31 of each year starting on January 1, 2016. The required transition period of April 1, 2015 to December 31, 2015 is included in this Form 10-K Transition Report. Amounts included in this report for the nine months ended December 31, 2014 are unaudited. Liquidity and Capital Resources. We have incurred substantial operating losses since our inception. During the quarter ended December 31, 2015, the Company generated its first ever cash operating profit. This performance is the result of increased sales and reduced expenses. Management will continue to press for improvements in operating performance during calendar 2016 although there can be no assurance these efforts will continue to generate cash operating profits. As of December 31, 2015, we had cash and cash equivalents totaling approximately $2.0 million. On September 18, 2015, we entered into a $7.0 million line of credit with Venture Bank to provide non-dilutive resources to execute management’s growth strategies for the PrimeSight and Urgent PC product lines and for general corporate purposes. Note 6 contains further information regarding the line of credit. If operations do not generate sufficient cash in the future, and if we were to seek additional financing, there can be no assurance that any such additional financing will be available on terms acceptable to us, if at all. If required, we believe we would be able to reduce our expenses to a sufficient level to continue to operate as a going concern. Basis of Presentation. The consolidated financial statements include the accounts of Cogentix Medical, Inc. and its wholly owned subsidiaries. We have eliminated all intercompany accounts and transactions in consolidation. We have reclassified certain prior-year amounts to conform to the current year’s presentation. Revenue Recognition. We recognize revenue in accordance with the Financial Accounting Standards Board (the “FASB”) Accounting Standards Codification (“ASC”) 605 (Topic 605, Revenue Recognition . 1. persuasive evidence that an arrangement exists; 2. delivery has occurred or services were rendered; 3. the fee is fixed and determinable; and 4. collectability is reasonably assured We recognize revenue when title passes to the customer, generally upon shipment of our products F.O.B. shipping point. Revenue for service repairs of equipment is recognized after service has been completed, and service contract revenue is recognized ratably over the term of the contract. We review our service contracts to determine if multiple element arrangements exist. If there are multiple elements, we allocate revenue to all elements based on the stand-alone selling prices by applying the relative stand-alone selling price methodology. Deferred revenue represents the selling price of any deliverables of the arrangement for which the customer has provided consideration, but the revenue recognition requirements have not been satisfied. We include shipping and handling charges billed to customers in net sales, and include related costs incurred by us in cost of goods sold. Typically our agreements contain no customer acceptance provisions or clauses. We sell our products to end users and to distributors. Payment terms range from prepayment to 120 days. Sales to distributors are not contingent on the distributor selling the product to end users. Customers do not have the right to return products except for warranty claims. We offer customary product warranties. We present our sales in our statement of operations net of taxes, such as sales, use, value-added and certain excise taxes, collected from the customers and remitted to governmental authorities. Use of Estimates. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. Our significant accounting policies and estimates include revenue recognition, accounts receivable, valuation of inventory, foreign currency translation/transactions, purchase price allocations on acquisition, the determination of recoverability of long-lived assets and liabilities and intangible assets, long-term incentive plans, share-based compensation, defined benefit pension plans, and income taxes. Advertising Expenses. Advertising costs are expensed as incurred. Such costs incurred were approximately $383,000 in the nine-month transition period ended December 31, 2015, $325,000 in the nine-month period ended December 31, 2014 and $437,000 and $595,000 in the fiscal years ended March 31, 2015 and 2014, respectively. Research and Development Expenses. Costs of research, new product development, and product redesign are charged to expense as incurred. Share-Based Compensation. We account for share-based compensation costs under ASC 718, “Compensation – Stock Compensation”. ASC 718 covers a wide range of share-based compensation arrangements including stock options, restricted share plans, performance-based awards, share appreciation rights, and employee share purchase plans. We recognize the compensation cost relating to share-based payment transactions, including grants of employee stock options and restricted shares, in our financial statements. We measure that cost based on the fair value of the equity or liability instruments issued. Long-Term Incentive Plan and Awards. We have a long-term incentive plan (“LTIP”). Awards under the LTIP are accounted for as liability awards as the awards are based on the performance of our common stock and are expected to be settled in cash. The fair value of the awards is calculated on a quarterly basis using a Monte Carlo valuation model and is recognized over the derived service period. Vesting of the awards is based on meeting the stock price criteria, the probability of which is considered in determining the estimated fair value. Defined Benefit Pension Plans. We have a liability attributed to defined benefit pension plans we offered to certain former and current employees of our subsidiaries in the UK and the Netherlands. The liability is dependent upon numerous factors, assumptions and estimates, and the continued benefit costs we incur may be significantly affected by changes in key actuarial assumptions such as the discount rate, mortality, compensation rates, or retirement dates used to determine the projected benefit obligation. Additionally, changes made to the provisions of the plans may impact current and future benefit costs. In accordance with the provisions of ASC 715, “Compensation – Retirement Benefits”, changes in benefit obligations associated with these factors may not be immediately recognized as costs in the statement of operations, but are recognized in future years over the expected average future service of the active employees or the average remaining life expectancies of inactive employees. Disclosures About Fair Value of Financial Instruments. Estimates of fair value for financial assets and liabilities are based on the framework established in the accounting guidance for fair value measurements. The framework defines fair value, provides guidance for measuring fair value and requires certain disclosures. The framework prioritizes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The following three broad levels of inputs may be used to measure fair value under the fair value hierarchy: · Level 1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities. · Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. · Level 3: Significant unobservable inputs that cannot be corroborated by observable market data and reflect the use of significant management judgment. These values are generally determined using pricing models for which the assumptions utilize management’s estimates of market participant assumptions. If the inputs used to measure the financial assets and liabilities fall within more than one of the different levels described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument. During the reporting periods presented, the only asset or liability carried at fair value measured on a recurring basis was the long-term incentive plan accrual. The estimated fair value as of December 31, 2015 and March 31, 2015 was $130,000 and $730,000, respectively, which are considered level 3 measurements. The long-term incentive plan began on October 2, 2014 and is described in Note 5. The estimated fair value of the accrual is calculated on a quarterly basis using a Monte Carlo valuation model. Vesting is based on the probability of meeting the stock price criteria, the probability of which is considered in determining the estimated fair value. Remeasurements to fair value on a nonrecurring basis relate primarily to our property, plant and equipment and intangible assets and occur when the derived fair value is below their carrying value on our Consolidated Balance Sheet. We had no remeasurements of such assets to fair value in any of the periods covered in this report. The carrying amounts reported in the Consolidated Balance Sheets for cash and cash equivalents, accounts receivable, inventories, other current assets, accounts payable, accrued liabilities and convertible debt-related party approximate fair market value. Cash, Cash Equivalents and Marketable Securities. We consider all cash on-hand and highly liquid investments with original maturities of three months or less when purchased to be cash equivalents. We classify marketable securities having original maturities of more than three months when purchased and remaining maturities of one year or less as short-term investments and marketable securities with remaining maturities of more than one year as long-term investments. We further classify marketable securities as either held-to-maturity or available-for-sale. We classify marketable securities as held-to-maturity when we believe we have the ability and intent to hold such securities to their scheduled maturity dates. All other marketable securities are classified as available-for-sale. We have not designated any of our marketable securities as trading securities. We carry held-to-maturity marketable securities at their amortized cost and available-for-sale marketable securities at their fair value and report any unrealized appreciation or depreciation in the fair value of available-for-sale marketable securities in accumulated other comprehensive income (loss). We monitor our investment portfolio for any decline in fair value that is other-than-temporary and record any such impairment as an impairment loss. We recorded no impairment losses for other-than-temporary declines in the fair value of marketable securities in any of the periods covered in this report. Cash and cash equivalents include highly liquid money market funds and debt securities with original maturities of three months or less totaling $2.0 million and $9.3 million at December 31 2015, and March 31, 2015, respectively. Money market funds present negligible risk of changes in value due to changes in interest rates, and their cost approximates their fair market value. We maintain cash in bank accounts, which, at times, may exceed federally insured limits. We have not experienced any losses in such accounts. Cash and cash equivalents held in foreign bank accounts totaled $507,000 and $896,000 at December 31, 2015 and March 31, 2015, respectively. Accounts Receivable. We grant credit to our customers in the normal course of business and, generally, do not require collateral or any other security to support amounts due. If necessary, we have an outside party assist us with performing credit and reference checks and establishing credit limits for the customer. Concentration of credit risk with respect to accounts receivable relates to certain domestic and international customers to whom we make substantial sales. To reduce risk, we routinely assess the financial strength of our customers and, when appropriate, we obtain advance payments for our international sales. As a consequence, we believe that our accounts receivable credit risk exposure is limited. Historically we have not experienced any significant credit losses related to any individual customer or group of customers in any particular industry or geographic area. Accounts outstanding longer than the contractual payment terms, are considered past due. We carry our accounts receivable at the original invoice amount less an estimated allowance for doubtful receivables based on a periodic review of all outstanding amounts. We determine the allowance for doubtful accounts based on the customer’s financial health, and both historical and expected credit loss experience. We write off our accounts receivable when we deem them uncollectible. We record recoveries of accounts receivable previously written off when received. We are not always able to timely anticipate changes in the financial condition of our customers and if circumstances related to these customers deteriorate, our estimates of the recoverability of accounts receivable could be materially affected and we may be required to record additional allowances. Alternatively, if more allowances are provided than are ultimately required, we may reverse a portion of such provisions in future periods based on the actual collection experience. Historically, the accounts receivable balances we have written off have generally been within our expectations. The allowance for doubtful accounts was $68,000 and $33,000 at December 31, 2015, and March 31, 2015, respectively. Inventories. We state inventories at the lower of cost or market using the first-in, first-out method. We value at lower of cost or market the slow moving and obsolete inventories based upon current and expected future product sales and the expected impact of product transitions or modifications. Historically, the inventory write-offs have generally been within our expectations. Inventories consist of the following: 12/31/15 3/31/15 Raw materials $ 2,385,000 $ 3,156,000 Work-in-process 793,000 527,000 Finished goods 1,407,000 1,143,000 $ 4,585,000 $ 4,826,000 Inventories acquired in a business combination are recorded at their estimated fair value less profit for sales efforts and expensed in cost of sales as that inventory is sold. As of March 31, 2015, the purchase accounting adjustment of $240,000 related to VSCI inventory was recorded in cost of goods sold over approximately the first four months of the transition period ended December 31, 2015. Property, Plant and Equipment. We carry property, plant and equipment, including leasehold improvements, at cost, less accumulated depreciation or fair value if acquired in a business combination, which consists of the following balances: 12/31/15 3/31/15 Land $ 133,000 $ 133,000 Building 610,000 606,000 Leasehold improvements 1,222,000 807,000 Internal use software 782,000 749,000 Equipment 3,042,000 6,888,000 $ 5,789,000 $ 9,183,000 Less accumulated depreciation and amortization (3,234,000 ) (7,370,000 ) $ 2,555,000 $ 1,813,000 We provide for depreciation using the straight-line method over useful lives of three to seven years for equipment and 40 years for the building. Certain products used as sales demonstration and service loaner equipment are transferred from inventory to machinery and equipment and are depreciated over 3 years. We charge maintenance and repairs to expense as incurred. We capitalize improvements and amortize them over the shorter of their estimated useful service lives or the remaining lease term. We recognized depreciation expense of approximately $672,000 in the nine-month transition period ended December 31, 2015, $183,000 in the nine-months ended December 31, 2014 and $249,000 and $323,000 in the fiscal years ended March 31, 2015 and 2014, respectively. We capitalized internal use software and web site development costs of approximately $34,000 in the nine-month transition period ended December 31, 2015, $66,000 in the nine-month period ended December 31, 2014, and $185,000 and $25,000 in fiscal 2015 and 2014, respectively. These costs are amortized over a three-year period. The net book value of our capitalized software for internal use was approximately $183,000 and $183,000 at December 31, 2015 and March 31, 2015, respectively. Goodwill. Goodwill results from the Merger and represents the excess of the purchase price over the fair value of acquired tangible assets and liabilities and identifiable intangible assets. Annually on November 30 or if conditions indicate an additional review is necessary, the Company assesses qualitative factors to determine if it is more likely than not that the fair value of a reporting unit is less than its carrying amount and if it is necessary to perform the quantitative two-step goodwill impairment test. If the Company performs the quantitative test, it compares the carrying value of the reporting unit to an estimate of the reporting unit’s fair value to identify potential impairment. The fair value of each reporting unit is estimated using a discounted cash flow model. Where available, and as appropriate, comparable market multiples are also used to corroborate the results of the discounted cash flow models. In determining the estimated future cash flow, the Company considers and applies certain estimates and judgments, including current and projected future levels of income based on management’s plans, business trends, prospects and market and economic conditions and market-participant considerations. If the estimated fair value of the reporting unit is less than the carrying value, a second step is performed to determine the amount of the potential goodwill impairment. If impaired, goodwill is written down to its estimated implied fair value. For the November 30, 2015 annual impairment test, the Company performed step one of the two-step goodwill impairment test. Based on the results of the step one analysis, the Company concluded that the fair value of its reporting unit was substantially in excess of the carrying value. There was no goodwill impairment loss for the nine-month transition period ended December 31, 2015. Impairment of Long-Lived Assets. Long-lived assets consist of property, plant and equipment and intangible assets. We review our long-lived assets for impairment whenever events or business circumstances indicate that we may not recover the carrying amount of an asset. We measure recoverability of assets held and used from a comparison of the carrying amount of an asset to future undiscounted net cash flows we expect to generate by the asset. If we consider such assets impaired, we measure the impairment recognized by the amount by which the carrying amount of the assets exceeds the fair value of the assets. We completed our impairment analysis and concluded there were no impairments in any of the periods covered in this report. Product Warranty. We warrant our products to be free from defects in material and workmanship under normal use and service for a period of twelve months after the date of sale. Under the terms of these warranties, we repair or replace products we deem defective due to material or workmanship. The following table summarizes changes in our warranty reserve: 12/31/15 3/31/15 Warranty reserve at beginning of period $ 146,000 $ 9,000 Warranties accrued during the period 50,000 1,000 Warranties settled during the period (50,000 ) - Warranty reserve for VSCI - 136,000 Warranty reserve at end of period $ 146,000 $ 146,000 Other Liabilities. Other liabilities consist of the following: 12/31/15 3/31/15 Investment banking fee payable - 1,750,000 Sales tax and VAT payable 243,000 261,000 Accrued legal and accounting fees 69,000 189,000 Deferred rent - 148,000 Deferred revenue 308,000 - Other accrued expenses 329,000 102,000 $ 949,000 $ 2,450,000 Foreign Currency Translation. We translate all assets and liabilities of our foreign subsidiaries using period-end exchange rates. We translate statements of operations items using average exchange rates for the period. We record the resulting translation adjustment within accumulated other comprehensive loss, a separate component of shareholders’ equity. We recognize foreign currency transaction gains and losses in our consolidated statements of operations, including unrealized gains and losses on short-term intercompany obligations using period-end exchange rates. We recognize foreign currency transaction gains and losses primarily as a result of fluctuations in currency rates between the U.S. dollar (the functional reporting currency) and the Euro and British pound (currencies of our subsidiaries), as well as their effect on the dollar denominated intercompany obligations between us and our foreign subsidiaries. All intercompany balances are revolving in nature and we do not deem any portion of them to be long-term. We recognized foreign currency transaction gains and losses of approximately $(14,000) in the nine-month transition period ended December 31, 2015, $(3,000) in the nine months ended December 31, 2014 and $(4,000) and $(5,000) in the fiscal years ended March 31, 2015 and 2014, respectively. Income Taxes. We account for income taxes using the asset and liability method. The asset and liability method provides that deferred tax assets and liabilities be recorded based on the differences between the tax basis of assets and liabilities and their carrying amounts for financial reporting purposes. We reduce deferred tax assets by a valuation allowance, when we believe it is more likely than not that some portion or all of the deferred tax assets will not be realized. ASC 740, “ Accounting for Income Taxes Under our accounting policies we recognize interest and penalties accrued on unrecognized tax benefits as well as interest received from favorable tax settlements within income tax expense. Basic and Diluted Net Loss per Share. We calculate basic net loss per common share amounts by dividing net loss by the weighted-average common shares outstanding, excluding outstanding shares contingently subject to forfeiture. For calculating diluted net loss per common share amounts, we add additional shares to the weighted-average common shares outstanding for the assumed exercise of stock options and vesting of restricted shares, if dilutive. Because we have had net losses, the following options and warrants outstanding and unvested restricted stock to purchase shares of our common stock were excluded from diluted net loss per common share because of their anti-dilutive effect, and therefore, basic net loss per common share equals dilutive net loss per common share: Number of options, warrants and unvested restricted stock Range of exercise prices Period ended: Nine-months December 31, 2015 3,637,000 $1.64 - $24.40 Nine-months December 31, 2014 2,285,000 $2.84 - $24.40 March 31, 2015 2,569,000 $2.70 - $24.40 March 31, 2014 2,476,000 $1.06 - $24.40 March 31, 2013 2,196,000 $1.06 - $24.40 Recently Adopted Accounting Pronouncements In 2015, the Company adopted Accounting Standards Update (“ASU”) 2015-03, Interest – Imputation of Interest (Subtopic 835-30) – Simplifying the Presentation of Debt Issuance Costs. The amendments in this update require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of the debt liability. The Company adopted this standard in conjunction with obtaining its new loan facility. There was no impact of the retrospective adoption to prior periods. Recently Issued Accounting Pronouncements Not Yet Adopted. In February 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-2, Leases, under which lessees will recognize most leases on-balance sheet. This will generally increase reported assets and liabilities. For public entities, this ASU is effective for annual and interim periods in fiscal years beginning after December 15, 2018. ASU 2016-2 mandates a modified retrospective transition method for all entities. The Company will begin the process of determining the impact this ASU will have on the Company’s consolidated financial statements. In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes, In September 2015, the FASB issued ASU No. 2015-16, “Business Combinations (Topic 805).” The amendments in this update require that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. Under the new guidance, the acquirer should record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date. On the face of the income statement or in the notes, the portion of the amount recorded in current-period earnings by line item that would have been recorded in previous reporting periods need to be reflected as if the adjustment to the provisional amounts had been recognized as of the acquisition date. The amendments in ASU No. 2016-16 are effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. We do not believe the adoption of this update will have a material impact on our consolidated financial statements. In July 2015, the FASB issued ASU No. 2015-12, “Plan Accounting: Defined Benefit Pension Plans (Topic 815).” Under the new guidance, plans are no longer required to measure fully benefit-responsive investment contracts (FBRICs) at fair value, disaggregate investments by nature, risks and characteristics, disclose individual investments that represent five percent or more of net assets available for benefits, or disclose net appreciation or depreciation for investments by general price. The amendments in ASU No. 2015-12 are effective for fiscal years beginning after December 15, 2015 and earlier adoption is permitted. We are still evaluating whether or not this update is applicable to our business. In July 2015, the FASB issued ASU No. 2015-11, “Simplifying the Measurement of Inventory (Topic 330).” Under the current guidance (i.e., ASC 330-10-352 before the ASU), an entity subsequently measures inventory at the lower of cost or market, with market defined as replacement cost, net realizable value (NRV), or NRV less a normal profit margin. An entity uses current replacement cost provided that it is not above NRV (i.e., the ceiling) or below NRV less an “approximately normal profit margin” (i.e., the floor). The new guidance requires entities to measure most inventory “at the lower of cost and net realizable value,” thereby simplifying the current guidance under which an entity must measure inventory at the lower of cost or market (market in this context is defined as one of three different measures). The ASU will not apply to inventories that are measured by using either the last-in, first-out (LIFO) method or the retail inventory method (RIM). The amendments in ASU No. 2015-11 are effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. We do not believe the adoption of this update will have a material impact on our consolidated financial statements. In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606), as amended by ASU 2015-14, “Deferral of Effective Date, which requires an entity to recognize revenue 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. ASU 2014-09 sets forth a new revenue recognition model that requires identifying the contract, identifying the performance obligations, determining the transaction price, allocating the transaction price to performance obligations and recognizing the revenue upon satisfaction of performance obligations. For public entities, this ASU is effective for annual reporting periods beginning after December 15, 2017 including interim reporting periods within that reporting period. The provisions can be adopted either retrospectively to each prior reporting period presented or as a cumulative-effect adjustment as of the date of adoption. The Company is currently in the process of determining the impact that this ASU will have on the consolidated financial statements and its method of adoption. |
Business Combinations-Merger Be
Business Combinations-Merger Between Uroplasty, Inc and Vision-Sciences, Inc | 9 Months Ended |
Dec. 31, 2015 | |
Business Combinations-Merger Between Uroplasty, Inc and Vision-Sciences, Inc [Abstract] | |
Business Combinations-Merger Between Uroplasty, Inc and Vision-Sciences, Inc | Note 2. Business Combinations-Merger Between Uroplasty, Inc and Vision-Sciences, Inc The Merger has been accounted for as an acquisition of VSCI by UPI, in accordance with Accounting Standards Codification (ASC) Topic 805, “Business Combinations,” using the acquisition method of accounting with UPI as the accounting acquirer. Since the Company (formerly known as Vision-Sciences), as the parent company of UPI after the Merger, is the legal acquirer, the Merger has been accounted for as a reverse acquisition. Under these accounting standards, UPI’s total purchase price of $16.5 million is calculated as if UPI had issued its shares to VSCI stockholders and converted options and warrants to purchase VSCI shares to options and warrants to purchase UPI’s common stock. Under the acquisition method of accounting, the total purchase price was allocated to the net tangible and intangible assets of VSCI acquired in the Merger, based on their fair values at the effective date of the Merger. The allocation was finalized without any change to the preliminary allocation and is as follows: Cash and cash equivalents $ 2,020,000 Accounts receivable 4,249,000 Inventories 4,462,000 Other current assets 369,000 Property, plant and equipment 817,000 Goodwill 18,750,000 Other intangibles 13,660,000 Other non-current assets 97,000 Total assets acquired 44,424,000 Accounts payable and other liabilities 5,209,000 Deferred revenue 176,000 Convertible debt – related party 22,530,000 Other non-current liabilities 40,000 Total liabilities assumed 27,955,000 Total purchase price $ 16,469,000 The allocation of the purchase price to the net assets acquired and liabilities assumed resulted in the recognition of the following intangible assets: Amount Weighted Average Life-Years Developed technology $ 6,200,000 7 Customer relationships 7,270,000 5 Trade names 190,000 10 $ 13,660,000 The supplemental unaudited pro forma net sales and net loss of the combined entity had the acquisition been completed on April 1, 2013: (Unaudited) December 31, Year ended March 31, 2014 2015 2014 Supplemental pro forma combined results of operations: Net sales $ 32,287,840 $ 44,973,000 $ 41,523,000 Net loss (10,239,430 ) (15,817,000 ) (21,477,000 ) Loss per share – basic and diluted $ (0.41 ) $ (0.62 ) $ (0.86 ) Adjustments to the supplemental pro forma combined results of operations are as follows: (Unaudited) December 31, Year ended March 31, 2014 2015 2014 Increase in amortization of intangibles $ 1,751,000 $ 2,334,000 $ 2,464,000 Adjust expenses related to merger (transaction costs, inventory step-up, deferred revenue adjustment) (4,399,000 ) (4,399,000 ) 4,801,000 Interest expense imputed on debt 899,000 1,198,000 1,144,000 Increase (decrease) in net loss $ (1,749,000 ) $ (867,000 ) $ 8,409,000 These unaudited pro forma condensed consolidated financial results have been prepared for illustrative purposes only and do not purport to be indicative of the results of operations that actually would have resulted had the acquisition occurred on the first day of the earliest period presented, or of future results of the consolidated entities. The unaudited pro forma condensed consolidated financial information does not reflect any operating efficiencies and cost savings that may be realized from the integration of the acquisition. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 9 Months Ended |
Dec. 31, 2015 | |
Goodwill and Other Intangible Assets [Abstract] | |
Goodwill and Other Intangible Assets | Note 3. Goodwill and Other Intangible Assets Goodwill. As described in Note 2, on March 31, 2015, for accounting purposes, UPI was deemed to have acquired VSCI for a purchase price of $16.5 million, and as a result, the Company recognized $18.8 million in goodwill. Other Intangible Assets. Other intangible assets consisted of the following at reporting dates presented below: December 31, 2015 March 31, 2015 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Developed technology $ 6,200,000 $ 664,000 $ 6,200,000 $ - Patents & trademarks 5,653,000 5,586,000 5,653,000 5,564,000 Trademarks and trade names 190,000 67,000 190,000 - Customer relationships 7,270,000 1,150,000 7,270,000 - 19,313,000 $ 7,467,000 19,313,000 $ 5,564,000 Accumulated amortization 7,467,000 5,564,000 Net book value of amortizable intangible assets $ 11,846,000 $ 13,749,000 Amortization costs were approximately $1,903,000, $24,000, $31,000 and $30,000 in the nine-month transition period ended December 31, 2015, the nine-month period ended December 31, 2014, and the fiscal years ended March 31, 2015 and 2014, respectively. The weighted average remaining amortization period for intangible assets as of December 31, 2015 was approximately 5 years. Estimated amortization expense for all intangible assets for the five years subsequent to December 31, 2015 is as follows: Year ending December 31, 2016 $ 2,348,000 2017 2,348,000 2018 2,348,000 2019 2,348,000 2020 587,000 |
Convertible Debt - Related Part
Convertible Debt - Related Party | 9 Months Ended |
Dec. 31, 2015 | |
Convertible Debt - Related Party [Abstract] | |
Convertible Debt - Related Party | Note 4 Convertible Debt – Related Party The following table is a summary of our convertible debt – related party: December 31, 2015 March 31, 2015 Gross Principal Amount Unamortized Debt Discount Net Amount Gross Principal Amount Unamortized Debt Discount Net Amount Note Payable A $ 20,000,000 $ (3,639,000 ) $ 16,361,000 $ 20,000,000 $ (4,210,000 ) $ 15,790,000 Note Payable B 3,500,000 (562,000 ) 2,938,000 3,500,000 (650,000 ) 2,850,000 Note Payable C 4,990,000 (952,000 ) 4,038,000 4,990,000 (1,101,000 ) 3,889,000 $ 28,490,000 $ (5,153,000 ) $ 23,337,000 $ 28,490,000 $ (5,961,000 ) $ 22,529,000 The Convertible Debt-Related Party is held by Mr. Lewis Pell, a member of Cogentix’s board of directors, and consists of three convertible promissory notes. · Note Payable A accrues annual interest at the rate of 0.84%. The outstanding principal amount of Note Payable A is convertible into shares of our common stock at a conversion price of $6.00 per share. · Note Payable B accrues annual interest at the rate of 1.66%. The outstanding principal amount of Note Payable B is convertible into shares of our common stock at a conversion price of $4.45 per share. · Note Payable C accrues annual interest at the rate of 1.91%. The outstanding principal amount of Note Payable C is convertible into shares of our common stock at a conversion price of $5.55 per share. At December 31, 2015, we had an aggregate amount of $758,000 in accrued interest under the convertible notes payable, which is included in interest payable on our consolidated balance sheet. The convertible promissory notes mature on March 31, 2020 or earlier upon a change of control (as defined). The convertible promissory notes generally cannot be converted prior to March 31, 2018. The convertible promissory notes may be converted earlier prior to a change in control or in connection with our prepayment of the convertible promissory notes. The convertible promissory notes may be prepaid, at our option and upon 15 days’ notice to Mr. Pell, without other premium or penalty, with a combination of cash and common stock. Interest on the convertible promissory notes is payable on the maturity date or upon repayment or conversion of all or any portion of the principal under the note. The convertible promissory notes were amended concurrently with the execution of the merger agreement to extend the maturity from the fifth anniversary from their issuance dates to the fifth anniversary of the effective date of the merger and to change the conversion date from anytime to generally not earlier than three years after the effective date of the merger. Under purchase accounting for the merger, the convertible promissory notes were recorded at fair value, resulting in a discount from their face value of $5,960,000. The discount is being amortized over the remaining term based on the effective interest rate method with an imputed interest rate of 4.72%. The amendments to the convertible notes payable were considered to be part of an arrangement entered into between Mr. Pell and the Company during the merger negotiations that were separate from the business combination. Accordingly, the fair value of the notes was based on the terms that existed prior to the amendment. The fair value of the notes was determined using a lattice model with key assumptions of a risk free rate of 1.37%, market interest rate of 10.3%, and annualized volatility of 65%, less any increase in the fair value of the conversion feature resulting from the amendments. The increase in the fair value of the conversion feature was based on a comparative analysis of the conversion feature’s value under both the original terms and modified terms using the same key assumptions. Stock warrants originally issued in connection with the issuance of the convertible promissory notes are described in Note 5. |
Shareholders' Equity
Shareholders' Equity | 9 Months Ended |
Dec. 31, 2015 | |
Shareholders' Equity [Abstract] | |
Shareholders' Equity | Note 5. Shareholder’s Equity Reverse Acquisition. As discussed in Note 2, the merger is accounted for as reverse acquisition with VSCI as the legal acquirer and UPI as the accounting acquirer. Under reverse acquisition accounting, the dollar amount for common stock is based on the par value and number of shares issued by VSCI (reflecting the legal structure of VSCI as the legal acquirer) on the merger date plus subsequent shares issued by the Company. Additional paid-in capital represents that of UPI and includes the fair value of shares deemed for accounting purposes to have been issued by UPI on the merger date, as well as the fair value of the VSCI stock options and warrants included in the purchase price calculation. The UPI additional paid-in capital was also adjusted for the difference between the number of common shares outstanding and the historical number of shares of UPI common stock. Share-based Compensation. At December 31, 2015, as a result of the merger, the Company had one active plan, the Cogentix Medical 2015 Omnibus Incentive Plan, for share-based compensation grants (“the 2015 Plan”). Under the 2015 Plan, if we have a change in control, all outstanding grants, including those subject to vesting or other performance targets, fully vest immediately. Under the 2015 Plan, we reserved 2,500,000 shares of our common stock for share-based grants and 1,276,186 On July 23, 2013, and in connection with the commencement of his employment, our CEO Robert Kill received a stock grant of 217,986 shares that did not have vesting restrictions. We grant option awards with an exercise price equal to the closing market price of our stock at the date of the grant. We have options outstanding to purchase 2,573,640 shares of common stock granted under the 2015 Plan or UPI and VSCI plans. We have fully vested options outstanding to purchase 217,986 shares of common stock, not granted under a plan, which expire in May 2016. We grant options at the discretion of our directors. The options granted under the 2015 Plan generally provide for the exercise of options during a limited period following termination of employment, death or disability. We recognize share-based compensation expense in the statement of operations based on the fair value at the time of grant of the share-based payment over the requisite service period. We incurred a total of approximately $979,000, $1,389,000 and $1,436,000 in share-based compensation expense for the nine-month transition period ended December 31, 2015, and for the fiscal years ended 2015 and 2014, respectively. We determine the fair value of the option awards using the Black-Scholes option pricing model. We used the following weighted-average assumptions to value the options granted during the nine-month transition period ended December 31, 2015 and the fiscal years ended 2015 and 2014: December 31, 2015 March 31, 2015 March 31, 2014 Expected life, in years 3.84 3.29 4.51 Risk-free interest rate 1.11 % .74 % 1.36 % Expected volatility 63.9 % 63.4 % 89.1 % Expected dividend yield 0 % 0 % 0 % The expected life for options granted represents the period of time we expect options to be outstanding based on historical data of option holder exercise and termination behavior for similar grants. The risk-free interest rate for periods within the contractual life of the option is based on the U.S. Treasury rate over the expected life at the time of grant. Expected volatility is based upon historical volatility of our common stock. We estimate the forfeiture rate for stock awards to be approximately 10% for executive employees and directors and approximately 15% for non-executive employees for the nine-month transition period ended December 31, 2015 awards based on our historical experience. The following table summarizes the activity related to our stock options for the nine-month transition period ended December 31, 2015 and fiscal 2015 and 2014: Number of shares Weighted average exercise price Weighted average grant date fair value Aggregate intrinsic value Weighted average remaining life in years Balance at March 31, 2013 1,464,866 $ 4.84 $ 882,989 2.64 Options granted 682,296 3.54 $ 2.36 Options exercised (251,410 ) 1.67 1,089,978 Options surrendered (204,203 ) 5.81 Balance at March 31, 2014 1,691,549 4.67 2,451,075 3.85 Options granted 135,070 4.73 1.26 Options exercised (61,761 ) 1.10 170,944 Options surrendered (469,466 ) 6.91 Balance at March 31, 2015 1,295,392 4.03 - 3.91 Options converted from VSCI 955,473 7.07 4.75 6.62 Balance at March 31, 2015 2,250,865 5.32 - 5.06 Options granted 617,914 1.64 0.79 Options exercised - Options surrendered (295,139 ) 5.08 Balance at December 31, 2015 2,573,640 4.46 - 5.24 Options exercisable at December 31, 2015 1,699,792 4.56 - 3.92 The total fair value of stock options vested during the nine-month transition period ended December 31, 2015 and fiscal 2015 and 2014, respectively was approximately $519,000, $723,000 and $441,000, respectively. We received net proceeds of $68,000 in fiscal 2015 and $360,000 in fiscal 2014 from the exercise of stock options. There were no options exercised for the nine-month transition period ended December 31, 2015. We grant restricted shares at the discretion of our directors with vesting terms ranging from six months to four years. The following table summarizes the activity related to our restricted stock for the nine-month transition period ended December 31, 2015 and fiscal 2015: Number of Shares Weighted average grant date fair value Weighted average remaining life in years Aggregate intrinsic value Balance at March 31, 2013 130,791 $ 6.05 1.50 $ 1,087,226 Shares granted 88,647 4.22 Shares vested (38,510 ) 5.69 304,148 Shares surrendered (74,652 ) 6.03 Balance at March 31, 2014 106,276 4.65 2.23 743,167 Shares granted 305,248 4.34 Shares vested (82,060 ) 4.41 185,957 Shares surrendered (11,723 ) 5.56 Balance at March 31, 2015 317,741 4.47 1.93 387,644 Shares granted 513,299 1.62 Shares vested (122,353 ) 4.42 157,835 Shares surrendered (21,777 ) 2.73 Balance at December 31, 2015 686,910 2.41 1.59 886,114 The aggregate intrinsic value shown above for the restricted shares represents the total pre-tax value based on the closing price of our common stock on the grant date. At December 31, 2015, we had approximately $1,104,000 of unrecognized share-based compensation cost, net of estimated forfeitures, related to stock options and restricted shares that we expect to recognize over a weighted-average requisite service period of approximately two years. Stock Warrants-Related Party. At December 31, 2015, the Company has warrants outstanding that were issued to Mr. Pell to purchase an aggregate of 376,123 shares of our common stock at a weighted average exercise price of $9.31 per share. The duration in which the warrants may be exercised commences on the earlier of (i) March 31, 2018 or (ii) three days prior to the record date established for the declaration of any dividend or distribution of any rights in respect to our common stock in cash or other property other than our common stock, and terminates on the later of (x) the maturity date of the convertible promissory notes or (y) the date the convertible promissory notes are paid in full or converted into shares. In addition, the warrants may be exercised immediately prior to a change in control. Long-Term Incentive Plan and Awards . On October 1, 2014, the compensation committee of our board of directors and our board of directors approved and adopted a Performance Award Agreement under the Uroplasty, Inc. 2006 Amended Stock and Incentive Plan, as amended, and on October 2, 2014, grants of Performance Awards (the “Awards”) were made to certain members of our senior management team. Performance goals for the Awards are based on the achievement of specified stock price targets during the period beginning on the date of grant and ending on the fourth anniversary of the date of grant or, if earlier, the closing date of a change of control (as defined in the Plan) of the Company (the “Performance Period”). The stock price targets under the Awards are: $7.57 price per share of common stock, $10.32 price per share of common stock and $13.76 price per share of common stock. A stock price target is considered achieved on the date (a) the average closing price of the Cogentix common stock equals or exceeds a stock price target for at least 45 consecutive trading days or (b) of the consummation of a change of control of the Company, provided the closing price of Cogentix common stock on the last trading day immediately preceding the closing date of the change of control equals or exceeds a stock price target not previously achieved during the Performance Period. The Awards are accounted for as liability awards under the share based compensation accounting guidance, as the awards are based on the performance of our common stock and are expected to be settled in cash. Expense for the Awards value is recognized over the derived service period of approximately 2.4 years. We recorded a liability of $74,405 at December 31, 2015 and related income was $78,000 for the nine-month transition period ended December 31, 2015 for the Awards. |
Line of Credit
Line of Credit | 9 Months Ended |
Dec. 31, 2015 | |
Line of Credit [Abstract] | |
Line of Credit | Note 6. Line of Credit On September 18, 2015, we entered into a loan agreement with Venture Bank, a Minnesota banking corporation, providing us with a committed $7 million secured revolving credit facility (“Facility”), subject to eligible accounts receivable and inventory. The Facility will expire on March 18, 2017 and any loans outstanding on such date will mature and become payable. The Facility is secured by substantially all of our assets. Under the Facility, we may borrow the lesser of: (a) the sum of (i) eighty percent (80%) of the value of eligible accounts receivable; and (ii) forty percent (40%) of the value of eligible inventory capped at the lesser of (1) $2 million or (2) fifty percent (50%) of the Notes principal balance outstanding; or (b) $7 million. As of December 31, 2015, based on eligible receivables and inventory, our total available borrowing base was $5,653,000. We did not have any borrowings under the facility as of December 31, 2015. Loans under the Facility bear interest at a rate per annum equal to the Wall Street Journal Prime Rate plus 2.25%, provided that in no case will the interest charged be less than 5.5%. In the event that there is an event of default under the Facility, the interest rate will be increased by 6.0% for the entire period that an event of default exists. In addition, the Borrowers will pay a non-usage fee of 0.25% based on the average unused and available portion of the Facility on a monthly basis. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Dec. 31, 2015 | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | Note 7. Commitments and Contingencies Royalties. We received an absolute assignment of a patent relating to the Macroplastique Implantation System, in return for a royalty of 10 British Pounds for each unit sold during the life of the patent, which expires in September 2017. Under the terms of an agreement with former officers and directors of our Company, we also pay royalties equal to five percent of the net sales of certain Macroplastique products, subject to a specified monthly minimum of $4,500. We recognized an aggregate of $48,000, $274,000 and $353,000 of royalty expense under these agreements for the nine-month transition period ended December 31, 2015 and in fiscal 2015 and 2014, respectively. The royalties payable under these agreements ended when certain patents referenced in the agreement expired in May 2015. Purchase Requirements. In our normal course of business we have commitments, generally for periods of less than one year, to purchase from various vendors finished goods and manufacturing components under issued purchase orders. As of the nine-month transition period ended December 31, 2015 payments of our contractual obligations for purchase commitments within the next twelve months are $1,512,000. Operating Lease Commitments. We lease office, warehouse, and production space under operating lease agreements, which include escalating lease payments, and lease various automobiles for our European employees. These leases expire at various times through August 2025. At December 31, 2015, the approximate future minimum lease payments in subsequent calendar years under noncancelable operating leases with an initial term in excess of one year are as follows: 2016 $ 744,000 2017 610,000 2018 339,000 2019 228,000 Thereafter 762,000 $ 2,683,000 Total operating lease expenses were approximately $580,000 for the nine-month transition period ended December 31, 2015, $77,000 for the nine-months ended December 31, 2014 and $250,000 and $294,000 in fiscal 2015 and 2014, respectively. Employment Agreements. We have entered into employment agreements with certain officers, the terms of which, among other things, specify a base salary subject to annual adjustments by mutual agreement of the parties, and a severance payment to the employee upon employment termination without cause. We provide for various severance amounts payable under the agreements after employment termination. Contemporaneously with the execution of their employment agreement, all of the officers executed an “Employee Confidentiality, Inventions, Non-Solicitation, and Non-Compete Agreement.” This agreement prohibits the employee from disclosing confidential information, requires the employee to assign to us without charge all intellectual property relating to our business which is created or conceived during the term of employment, prohibits the employee from encouraging employees to leave our employment for any reason and prohibits competition with us during the term of employment and for a specified term thereafter. Product Liability. The manufacture and sale of medical devices exposes us to significant risk of product liability claims, some of which may have a negative impact on our business. Any defects or risks that we have not yet identified with our products may give rise to product liability claims. Our existing $10 million of worldwide product liability insurance coverage may be inadequate to protect us from liabilities we may incur or we may not be able to maintain adequate product liability insurance at acceptable rates. If a product liability claim or series of claims is brought against us for uninsured liabilities or in excess of our insurance coverage and it is ultimately determined that we are liable, our business could suffer. |
Savings and Retirement Plans
Savings and Retirement Plans | 9 Months Ended |
Dec. 31, 2015 | |
Savings and Retirement Plans [Abstract] | |
Savings and Retirement Plans | Note 8: Savings and Retirement Plans We sponsor various plans for eligible employees in the United States, the United Kingdom (“U.K.”), and The Netherlands. Our retirement savings plan in the United States conforms to Section 401(k) of the Internal Revenue Code of 1986, as amended, and participation is available to substantially all employees. We may also make discretionary contributions ratably to all eligible employees. We made discretionary contributions to the U.S. plan of approximately $261,000 in the nine-month transition period ended December 31, 2015, $206,000 in the nine-months ended December 31, 2014 and $282,000 and $224,000 for fiscal years ended March 31, 2015 and 2014, respectively. Our international subsidiaries in the U.K. and The Netherlands have defined benefit retirement plans for eligible employees. These plans provide benefits based on the employee’s years of service and compensation during the years immediately preceding retirement, termination, disability, or death, as defined in the plans. We froze the U.K. subsidiary’s defined benefit plan on December 31, 2004. On March 10, 2005, we established a defined contribution plan for the U.K. subsidiary. As of April 1, 2005, we closed The Netherlands subsidiary’s defined benefit retirement plan for new employees and established a defined contribution plan for them. The total contribution expense associated with the defined contribution plans in The Netherlands and the U.K. was approximately $33,000 in the nine-month transition period ended December 31, 2015, $19,000 in the nine-months ended December 31, 2014 and $24,000 and $22,000 for the fiscal years ended March 31, 2015, and 2014, respectively. The amortization of actuarial gains or losses is included as a component of the annual expense for a period if, as of the beginning of the period, the cumulative net gain or loss exceeds 10% of the greater of the projected benefit obligation or plan assets. If amortization is required, the amortization is that excess divided by the expected average future service of the active employees participating in the plans or the average remaining life expectancies of inactive employees. The Netherlands defined benefit plan. The Netherlands defined benefit pension plan is funded through a guaranteed insurance contract with Zwitser Leven, an insurance company. Our contract with Zwitser Leven requires us to make annual premium payments which are sufficient to satisfy the vested benefit obligation (“VBO”). Zwitser Leven does not hold separate investment assets for our contract, but rather is obligated to provide the stream of future benefits for the annual premium payments we make. We calculate the market value of the pension plan assets, held in Zwitser Leven insured assets, as the stream, based on mortality, of the earned guaranteed benefit payments discounted at a market interest rate. The benefit obligation is calculated based on the same assumptions as well. Accordingly, the impact on pension plan assets of a change in assumption for discount rate and mortality would equally offset the change in VBO. At December 31, 2015, we project the following benefit payments in subsequent years: 2016 $ 21,000 2017 21,000 2018 21,000 2019 26,000 2020 26,000 2021 to 2025 156,000 $ 271,000 We contributed approximately $73,000 in the nine-month transition period ended December 31, 2015, $167,000 in the nine-months ended December 31, 2014, $147,000 in fiscal 2015, $216,000 in fiscal 2014, and expect to contribute approximately $65,000 in 2016. The following table summarizes the change in benefit obligations and the change in plan assets: Nine months ended December 31, 2015 Fiscal year ended March 31, 2015 Changes in benefit obligations: Projected benefit obligation, beginning of period $ 4,465,000 $ 3,343,000 Service cost 109,000 133,000 Interest cost 51,000 102,000 Benefits paid (16,000 ) (7,000 ) Plan amendment - (110,000 ) Actuarial result (977,000 ) 2,006,000 Foreign currency translation 33,000 (1,002,000 ) Projected benefit obligation, end of period $ 3,665,000 $ 4,465,000 Changes in plan assets: Plan assets, beginning of period $ 3,593,000 $ 2,665,000 Contributions to plan 73,000 147,000 Management cost (4,000 ) (10,000 ) Actual return on assets (670,000 ) 1,603,000 Benefits paid (16,000 ) (7,000 ) Foreign currency translation 26,000 (805,000 ) Plan assets, end of period $ 3,002,000 $ 3,593,000 The amount recognized in other comprehensive loss consists of: Nine months ended December 31, 2015 Fiscal Year 2015 Unrecognized net prior service benefit $ (313,000 ) $ (339,000 ) Unrecognized net losses 656,000 941,000 Additional other comprehensive loss (gross of income taxes) $ 343,000 $ 602,000 The projected benefit obligation, accumulated benefit obligations and the fair value plan were as follows: December 31, 2015 March 31, 2015 Projected benefit obligation $ 3,665,000 $ 4,465,000 Accumulated benefit obligation 3,107,000 3,710,000 Fair value of plan assets 3,002,000 3,593,000 We have recorded the excess of the projected benefit obligation over the fair value of the plan assets on December 31, 2015 and March 31, 2015, of $663,000 and $872,000, respectively, as accrued pension liability. The cost of our defined benefit retirement plan includes the following components: Nine months ended December 31, 2015 Nine months ended December 31, 2014 Fiscal Year 2015 Fiscal Year 2014 Gross service cost, net of employee contribution $ 98,000 $ 92,000 $ 118,000 $ 113,000 Interest cost 51,000 81,000 102,000 108,000 Management cost 6,000 8,000 11,000 11,000 Expected return on assets (42,000 ) (58,000 ) (72,000 ) (72,000 ) Amortization 1,000 (1,000 ) (2,000 ) - Net periodic retirement cost $ 114,000 122,000 $ 157,000 $ 160,000 Major assumptions used in the above calculations include: December 31, 2015 March 31, 2015 Discount rate 2.40 % 1.50 % Expected return on assets 2.40 % 1.50 % Expected rate of increase in future compensation: General 2.5 % 2.5 % Individual 0-3 % 0-3 % The discount rate used is based upon the yields available on high quality corporate bonds with a term that matches the liabilities. The impact of the increase in discount rate used at December 31, 2015 as compared to March 31, 2015 was a decrease in the projected benefit obligation and actual return on assets. The market value of the assets is determined as the discounted stream of guaranteed benefit payments. Given the valuation method of the assets, the expected long-term rate of return on assets equals the discount rate. The U.K. defined benefit plan. As of December 31, 2015 and March 31, 2015, we held all the assets of the U.K. defined benefit pension plan in a Deposit Administration Contract with Phoenix Life Limited. At December 31, 2015 we project the following benefit payments in subsequent years: 2016 $ 83,000 2017 28,000 2018 160,000 2019 53,000 2020 - 2021 to 2025 783,000 $ 1,107,000 We contributed approximately $33,000 in the nine-month transition period ended December 31, 2015, $35,000 in the nine-months ended December 31, 2014, $45,000 in fiscal 2015, $43,000 in fiscal 2014, and expect to contribute approximately $43,000 in 2016. The following table summarizes the change in benefit obligations and the change in plan assets: Nine months ended December 31, 2015 Fiscal Year March 31, 2015 Changes in benefit obligations: Projected benefit obligation, beginning of period $ 814,000 $ 755,000 Service cost 4,000 5,000 Interest cost 21,000 34,000 Other (4,000 ) (5,000 ) Actuarial result (91,000 ) 119,000 Foreign currency translation - (94,000 ) Projected benefit obligation, end of period $ 744,000 $ 814,000 Changes in plan assets: Plan assets, beginning of period $ 730,000 $ 756,000 Contributions to plan 33,000 45,000 Management cost (4,000 ) (5,000 ) Actual return on assets 19,000 21,000 Foreign currency translation (3,000 ) (87,000 ) Plan assets, end of period $ 775,000 $ 730,000 The amount recognized in other comprehensive loss consists of: Nine months ended December 31, 2015 Fiscal year 2015 Unrecognized net losses (gross of deferred taxes) $ 116,000 $ 228,000 The projected benefit obligation, accumulated benefit obligation and the fair value plan assets were as follows: December 31, 2015 March 31, 2015 Projected benefit obligation $ 744,000 $ 814,000 Accumulated benefit obligation 744,000 814,000 Fair value of plan assets 775,000 730,000 We have recorded the excess of the fair value of the plan assets over the projected benefit obligation of $31,000, as of December 31, 2015, as prepaid pension asset. We have recorded the excess of the projected benefit obligation over the fair value of the plan assets on March 31, 2015 of $84,000, as accrued pension liability. The cost of our defined benefit retirement plan includes the following components for the years ended: Nine months ended December 31, 2015 Nine months ended December 31, 2014 Fiscal Year 2015 Fiscal Year, 2014 Gross service cost, net of employee contribution $ 4,000 $ 4,000 $ 5,000 $ 5,000 Interest cost 21,000 25,000 34,000 33,000 Expected return on assets (15,000 ) (21,000 ) (28,000 ) (21,000 ) Amortization 19,000 4,000 5,000 7,000 Net periodic retirement cost $ 29,000 12,000 $ 16,000 $ 24,000 Major assumptions used in the above calculations include: December 31, 2015 March 31, 2015 Discount rate 4.00 % 3.40 % Expected return on assets 3.00 % 2.60 % The discount rate used is based upon the yields available on high quality corporate bonds with a term that matches the liabilities. The expected return on assets assumption on the investment portfolio for the defined benefit plan is based on the long-term expected returns for the assets currently in the portfolio. Management uses historic return trends of the asset portfolio combined with recent market conditions to estimate the future rate of return. Plan Assets. The primary objective of the Netherlands pension plan is to meet retirement income commitments to plan participants at a reasonable cost. In The Netherlands, consistent with typical practice, the pension plan is funded through a guaranteed insurance contract with Zwitser Leven, an insurance company. Zwitser Leven is responsible for the investment strategy of the insurance premiums we make. We have characterized the assets of the pension plan as an “other contract.” The primary objective of the U.K. pension plan is to meet retirement income commitments to plan participants at a reasonable cost. The objective is achieved through growth of capital and safety of funds invested. The pension plan assets are invested in a Deposit Administration Contract with Phoenix Life Limited, an insurance company, with underlying investments primarily in fixed interest U.K. government bonds. The allocation of pension plan assets was as follows: December 31, 2015 March 31, 2015 Target Allocation Actual Allocation Target Allocation Actual Allocation Other Contract (Netherlands Plan) 100 % 100 % 100 % 100 % Deposit Administration Contract (U.K. Plan) 100 % 100 % 100 % 100 % We calculate the market value of the pension plan assets, held in Zwitser Leven insured assets, as the stream, based on mortality (an unobservable input), of the earned guaranteed benefit payments discounted at market interest rate. Accordingly, we have classified the Netherlands pension plan assets as Level 3 assets. The market value of the U.K. pension plan reflects the value of our contributions to the plan and the credited accrued interest at the rate specified in the Deposit Administration Contract. Accordingly, we have classified the U.K. plan assets as Level 2 assets. The fair value of the pension plan assets by asset class is as follows: Asset Class Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) December 31, 2015 Other Contract (Netherlands Plan) $ 3,002,000 $ (3,000 ) $ - $ 3,005,000 Deposit Administration Contract (U.K. Plan) 775,000 - 775,000 - March 31, 2015 Other Contract (Netherlands Plan) $ 3,593,000 $ 15,000 $ - $ 3,578,000 Deposit Administration Contract (U.K. Plan) 730,000 - 730,000 - The reconciliation of beginning and ending balances for our Level 3 assets is as follows: Other Contract (Netherlands Pension Plan Assets) Beginning balance as at April 1, 2015 $ 3,578,000 Loss recognized in earnings 38,000 Actuarial Loss (713,000 ) Purchases 76,000 Sales (16,000 ) Transfers 16,000 Foreign currency translation 26,000 Ending balance as at December 31, 2015 $ 3,005,000 The unrealized actuarial loss of $713,000 for the nine months ended December 31, 2015, recognized in other comprehensive loss, is equally offset by an unrealized actuarial gain, recognized in other comprehensive income, in the vested benefit obligation. |
Income Taxes
Income Taxes | 9 Months Ended |
Dec. 31, 2015 | |
Income Taxes [Abstract] | |
Income Taxes | Note 9: Income Taxes The components of income tax expense consist of the following: 9 months 12/31/2015 9 months 12/31/2014 Fiscal year 3/31/2015 Fiscal year 3/31/2014 Income tax provision: Current: Federal and state 14,000 10,000 8,000 13,000 Foreign 35,000 24,000 55,000 45,000 Deferred: Federal and state - - - - Foreign (9,000 ) 22,000 3,000 14,000 Total income tax expense $ 40,000 $ 56,000 $ 66,000 $ 72,000 Actual income tax expense differs from statutory federal income tax benefit for the period presented is as follows: 9 months 12/31/2015 9 months 12/31/2014 Fiscal year 3/31/2015 Fiscal year 3/31/2014 Statutory federal income tax benefit $ (2,376,000 ) $ (1,809,000 ) $ (2,600,000 ) $ (1,799,000 ) State tax benefit, net of federal taxes (212,000 ) (163,000 ) (210,000 ) (125,000 ) Foreign tax (18,000 ) (32,000 ) (40,000 ) (39,000 ) Nondeductible expenses – other 92,000 91,000 126,000 122,000 Nondeductible exp – transaction costs 55,000 148,000 462,000 - Subpart F Income 20,000 26,000 33,000 35,000 Valuation allowance increase 1,377,000 1,946,000 2,478,000 1,007,000 Stock compensation shortfall 128,000 - - - Stock compensation true-up 83,000 132,000 132,000 267,000 NOL expiration and true-up 320,000 - (53,000 ) 307,000 Foreign tax credits - - - - Other 571,000 (283,000 ) (262,000 ) 297,000 Total income tax expense $ 40,000 $ 56,000 $ 66,000 $ 72,000 Deferred tax assets (liabilities) consist of the following: 12/31/2015 03/31/2015 Fixed assets $ (50,000 ) $ 400,000 Intangible assets (4,378,000 ) (5,086,000 ) Pension liability 135,000 199,000 Stock based compensation 1,661,000 1,624,000 Inventory 298,000 184,000 Debt discount (1,929,000 ) (1,881,000 ) Other reserves and accruals 437,000 564,000 Deferred rent 250,000 12,000 Undistributed foreign earnings (451,000 ) (429,000 ) Foreign tax credits 68,000 68,000 Net operating losses 20,812,000 19,885,000 16,853,000 15,540,000 Less valuation allowance (16,717,000 ) (15,340,000 ) $ 136,000 $ 200,000 At December 31, 2015, we had U.S. net operating loss (NOL) carryforwards of approximately $57.6 million for U.S. income tax purposes before any Section, which expire in 2018 through 2036. U.S. net operating loss carryforwards cannot be used to offset taxable income in foreign jurisdictions. In addition, future utilization of NOL carryforwards is subject to certain limitations under Section 382 of the Internal Revenue Code. This section generally relates to a 50 percent change in ownership of a company over a three-year period. For Uroplasty, we believe that the issuance of historical Uroplasty common stock in the December of 2006 follow-on public offering resulted in an “ownership change” under Section 382. Additionally, we believe there were ownership changes of historical Uroplasty in December of 2012 and, as a result of the merger, in March of 2015. Accordingly, our ability to use pre-acquisition Uroplasty generated NOL tax attributes is limited as follows: approximately $750,000 per year for periods prior to December 2006; approximately $2,000,000 per year for periods after December 2006 and before December 2012; and approximately $720,000 per year for periods after December 2012 and before March 2015. Also, we believe there was an ownership change of Cogentix in March of 2015 as a result of the merger causing a limitation in our ability to use pre-acquisition Cogentix generated NOL tax attributes for periods prior to March 2015 of approximately $1,500,000 per year for the first five years and approximately $430,000 thereafter. We have not performed a detailed analysis to determine whether an ownership change prior to March 31, 2015 had occurred. Such a change of ownership could limit our utilization of the net operating losses, and could be triggered by subsequent sales of securities by us or our stockholders. Certain stock option exercises resulted in tax deductions in excess of previously recorded tax benefits. The Company’s NOL carry forwards of $57.6 million referenced above include approximately $1.9 million of income tax deductions in excess of previously recorded tax benefits. Although these additional tax deductions are reflected in NOL carry forwards referenced above, the related tax benefit will not be recognized until the deductions reduce taxes payable. Accordingly, since the tax benefit does not reduce the company’s current taxes payable in the December 31, 2015 period, these tax benefits are not reflected in the Company’s deferred tax assets presented above. The tax benefit of these excess deductions will be reflected as a credit to additional paid-in-capital when and if recognized. We provide for a valuation allowance when it is more likely than not that we will not realize a portion of the deferred tax assets. We have established a valuation allowance for U.S. and certain foreign deferred tax assets due to the uncertainty that enough taxable income will be generated in those taxing jurisdictions to utilize the assets. Therefore, we have not reflected any benefit of such deferred tax assets in the accompanying financial statements. The deferred tax asset increased by $1,312,820 in the 9 months ending December 31, 2015, and by $2,199,966 and $1,010,227, respectively, in the fiscal years ending March 31, 2015 and 2014. The related valuation allowance increased by $1,377,053 in the nine months ending December 31, 2015, and by $2,477,900 and $1,006,587, respectively, in the fiscal years ending March 31, 2015 and 2014. We reviewed all income tax positions taken or that we expect to be taken for all open years and determined that our income tax positions are appropriately stated and supported for all open years. Under our accounting policies, we recognize interest and penalties on unrecognized tax benefits as well as interest received from favorable tax settlements within income tax expense. As of December 31, 2015 and March 31, 2015 and 2014, we recorded no accrued interest or penalties related to uncertain tax positions. We have provided for U.S. deferred income taxes as of December 31, 2015 and March 31, 2015 and 2014 for the undistributed earnings from our non-U.S. subsidiaries. The fiscal tax years 2011 through 2015 remain open to examination by the Internal Revenue Service and various state taxing jurisdictions to which we are subject. In addition, we are subject to examination by certain foreign taxing authorities for which the fiscal years 2011 through 2015 remain open for examination. |
Business Segment Information
Business Segment Information | 9 Months Ended |
Dec. 31, 2015 | |
Business Segment Information [Abstract] | |
Business Segment Information | Note 10: Business Segment Information ASC 280, “Segment Reporting,” We operate in two markets, the medical market and the industrial market. Within the medical market, we have a number of product lines, endoscopy-based products, including our PrimeSight flexible fiber and video endoscopes used in the practices of urology, pulmonology, trans-nasal esophagoscopy and ENT (ear, nose and throat) and a proprietary sterile disposable microbial barrier, known as EndoSheath Protective Barrier, the Urgent PC® Neuromodulation System (“Urgent PC System”) a minimally-invasive, neuromodulation system that delivers percutaneous tibial nerve stimulation for office-based treatment of overactive bladder and associated symptoms; and Macroplastique® Implants (“Macroplastique”), an injectable, urethral bulking agent for the treatment of adult female stress urinary incontinence. None of the industrial market sales, net losses or assets are more than 10% of our total sales, losses or assets. Therefore, we aggregate our operating segments into one reportable segment in accordance with the objectives and principles of the applicable guidance. Information regarding geographic area net sales to customers for the nine-month transition period ended December 31, 2015, the nine months ended December 31, 2014, and for the fiscal years ended March 31, 2015 and 2014, respectively, is as follows: United States United Kingdom All Other Foreign Countries (1) Consolidated Nine-month transition period ended December 31, 2015 $ 27,236,000 $ 3,213,000 $ 6,173,000 $ 36,622,000 Nine months ended December 31, 2014 $ 14,512,000 $ 1,923,000 $ 3,071,000 $ 19,506,000 Fiscal year ended March 31, 2015 $ 19,970,000 $ 2,506,000 $ 4,050,000 $ 26,526,000 Fiscal year ended March 31, 2014 $ 18,042,000 $ 2,485,000 $ 4,050,000 $ 24,577,000 (1) No other foreign country accounts for 10% or more of the consolidated net sales Information regarding geographic area long-lived assets at December 31, 2015 and March 31, 2015 is as follows: United States United Kingdom The Netherlands Consolidated December 31, 2015 $ 2,089,000 $ 3,000 $ 463,000 $ 2,555,000 March 31, 2015 $ 1,338,000 $ 3,000 $ 472,000 $ 1,813,000 Accounting policies for the operations in the various geographic areas are the same as those described in Note 1. Sales attributed to each geographic area are net of intercompany sales and are attributed to countries based on location of customers. No single customer represents 10% or more of our consolidated net sales. Long-lived assets consist of property, plant and equipment. |
Schedule I - Valuation and Qual
Schedule I - Valuation and Qualifying Accounts | 9 Months Ended |
Dec. 31, 2015 | |
Schedule I - Valuation and Qualifying Accounts [Abstract] | |
Schedule I - Valuation and Qualifying Accounts | Schedule I – Valuation and Qualifying Accounts Balance at beginning of fiscal year Additions charged to expenses Written off, less recoveries Effects of foreign currency fluctuations Balance at end of fiscal year Allowance for doubtful accounts Nine-month transition period ended December 31, 2015 $ 18,000 $ 66,000 $ (57,000 ) $ - $ 27,000 Fiscal year ended 25,000 8,000 (13,000 ) (2,000 ) 18,000 Fiscal year ended 21,000 8,000 (5,000 ) 1,000 25,000 Balance at beginning of fiscal year Additions charged against revenues Returns written off Effects of foreign currency fluctuations Balance at end of fiscal year Allowance for sales returns Nine-month transition period ended December 31, 2015 $ 15,000 $ 26,000 $ - $ - $ 41,000 Fiscal year ended 20,000 4,000 (9,000 ) - 15,000 Fiscal year ended 53,000 43,000 (76,000 ) - 20,000 |
Summary of Significant Accoun19
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Dec. 31, 2015 | |
Summary of Significant Accounting Policies [Abstract] | |
Nature of Business | Nature of Business. Cogentix Medical, Inc., headquartered in Minnetonka, Minnesota, with additional operations in New York, Massachusetts, The Netherlands and the United Kingdom, is a global medical device company. We design, develop, manufacture and market innovative proprietary technologies serving the urology, urogynecology/gyn, ENT (ear, nose and throat) and gastrointestinal markets. The Urgent® PC Neuromodulation System delivers percutaneous tibial nerve stimulation (PTNS) which has FDA clearance for the office-based treatment of overactive bladder (OAB) and has regulatory approvals for the treatment of OAB and fecal incontinence (FI) in various international markets. The FDA-cleared and CE marked PrimeSight Endoscopy Systems and EndoSheath Protective Barrier combine state-of-the-art endoscopic technology with a sterile, disposable microbial barrier, providing practitioners and healthcare facilities with a solution to meet the growing need for safe, efficient and cost-effective flexible endoscopy. The Company also offers Macroplastique®, a urethral bulking agent for the treatment of stress urinary incontinence. Outside the U.S., the Company markets additional bulking agents: PTQ ® ® The Company is the result of the Merger effective as of March 31, 2015, of two medical device companies, Uroplasty, Inc. (“UPI”) and Vision-Sciences, Inc. (“VSCI”). On the effective date of the Merger, the two companies completed an all-stock merger, pursuant to which UPI merged with and into Merger Sub, a wholly owned subsidiary of VSCI. Merger Sub was the surviving company from the Merger, and changed its name to Uroplasty, LLC. VSCI continued to be the sole member of the surviving company. After the merger, VSCI and its consolidated subsidiaries, including the surviving company, operate under the name Cogentix Medical, Inc. Upon closing of the Merger, the former UPI stockholders owned approximately 62.5% and the VSCI shareholders retained approximately 37.5% of the Company. Accordingly, while VSCI was the legal acquirer and issued its shares in the Merger, UPI is the acquiring company in the Merger for accounting purposes and the Merger has been accounted for as a reverse acquisition under the acquisition method of accounting for business combinations. As a result, the financial statements of the Company prior to the effective date of the Merger are the historical financial statements of UPI, whereas the financial statements of the Company after the effective date of the Merger reflect the results of the operations of UPI and VSCI on a combined basis. See additional disclosure provided in Note 2. All share amounts and price per share amounts for all periods presented relate to VSCI shares with UPI shares and price per share converted to VSCI amounts based on the conversion ratio in the acquisition agreement and the one for five reverse stock split. |
Change in Fiscal Year | Change in Fiscal Year. On December 10, 2015, the Board of Directors of the Company determined that, in accordance with its bylaws and upon recommendation of the Audit Committee, the Company’s fiscal year shall begin on January 1 and end on December 31 of each year starting on January 1, 2016. The required transition period of April 1, 2015 to December 31, 2015 is included in this Form 10-K Transition Report. Amounts included in this report for the nine months ended December 31, 2014 are unaudited. |
Liquidity and Capital Resources | Liquidity and Capital Resources. We have incurred substantial operating losses since our inception. During the quarter ended December 31, 2015, the Company generated its first ever cash operating profit. This performance is the result of increased sales and reduced expenses. Management will continue to press for improvements in operating performance during calendar 2016 although there can be no assurance these efforts will continue to generate cash operating profits. As of December 31, 2015, we had cash and cash equivalents totaling approximately $2.0 million. On September 18, 2015, we entered into a $7.0 million line of credit with Venture Bank to provide non-dilutive resources to execute management’s growth strategies for the PrimeSight and Urgent PC product lines and for general corporate purposes. Note 6 contains further information regarding the line of credit. If operations do not generate sufficient cash in the future, and if we were to seek additional financing, there can be no assurance that any such additional financing will be available on terms acceptable to us, if at all. If required, we believe we would be able to reduce our expenses to a sufficient level to continue to operate as a going concern. |
Basis of Presentation | Basis of Presentation. The consolidated financial statements include the accounts of Cogentix Medical, Inc. and its wholly owned subsidiaries. We have eliminated all intercompany accounts and transactions in consolidation. We have reclassified certain prior-year amounts to conform to the current year’s presentation. |
Revenue Recognition | Revenue Recognition. We recognize revenue in accordance with the Financial Accounting Standards Board (the “FASB”) Accounting Standards Codification (“ASC”) 605 (Topic 605, Revenue Recognition . 1. persuasive evidence that an arrangement exists; 2. delivery has occurred or services were rendered; 3. the fee is fixed and determinable; and 4. collectability is reasonably assured We recognize revenue when title passes to the customer, generally upon shipment of our products F.O.B. shipping point. Revenue for service repairs of equipment is recognized after service has been completed, and service contract revenue is recognized ratably over the term of the contract. We review our service contracts to determine if multiple element arrangements exist. If there are multiple elements, we allocate revenue to all elements based on the stand-alone selling prices by applying the relative stand-alone selling price methodology. Deferred revenue represents the selling price of any deliverables of the arrangement for which the customer has provided consideration, but the revenue recognition requirements have not been satisfied. We include shipping and handling charges billed to customers in net sales, and include related costs incurred by us in cost of goods sold. Typically our agreements contain no customer acceptance provisions or clauses. We sell our products to end users and to distributors. Payment terms range from prepayment to 120 days. Sales to distributors are not contingent on the distributor selling the product to end users. Customers do not have the right to return products except for warranty claims. We offer customary product warranties. We present our sales in our statement of operations net of taxes, such as sales, use, value-added and certain excise taxes, collected from the customers and remitted to governmental authorities. |
Use of Estimates | Use of Estimates. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. Our significant accounting policies and estimates include revenue recognition, accounts receivable, valuation of inventory, foreign currency translation/transactions, purchase price allocations on acquisition, the determination of recoverability of long-lived assets and liabilities and intangible assets, long-term incentive plans, share-based compensation, defined benefit pension plans, and income taxes. |
Advertising Expenses | Advertising Expenses. Advertising costs are expensed as incurred. Such costs incurred were approximately $383,000 in the nine-month transition period ended December 31, 2015, $325,000 in the nine-month period ended December 31, 2014 and $437,000 and $595,000 in the fiscal years ended March 31, 2015 and 2014, respectively. |
Research and Development Expenses | Research and Development Expenses. Costs of research, new product development, and product redesign are charged to expense as incurred. |
Share-Based Compensation | Share-Based Compensation. We account for share-based compensation costs under ASC 718, “Compensation – Stock Compensation”. ASC 718 covers a wide range of share-based compensation arrangements including stock options, restricted share plans, performance-based awards, share appreciation rights, and employee share purchase plans. We recognize the compensation cost relating to share-based payment transactions, including grants of employee stock options and restricted shares, in our financial statements. We measure that cost based on the fair value of the equity or liability instruments issued. |
Long-Term Incentive Plan and Awards | Long-Term Incentive Plan and Awards. We have a long-term incentive plan (“LTIP”). Awards under the LTIP are accounted for as liability awards as the awards are based on the performance of our common stock and are expected to be settled in cash. The fair value of the awards is calculated on a quarterly basis using a Monte Carlo valuation model and is recognized over the derived service period. Vesting of the awards is based on meeting the stock price criteria, the probability of which is considered in determining the estimated fair value. |
Defined Benefit Pension Plans | Defined Benefit Pension Plans. We have a liability attributed to defined benefit pension plans we offered to certain former and current employees of our subsidiaries in the UK and the Netherlands. The liability is dependent upon numerous factors, assumptions and estimates, and the continued benefit costs we incur may be significantly affected by changes in key actuarial assumptions such as the discount rate, mortality, compensation rates, or retirement dates used to determine the projected benefit obligation. Additionally, changes made to the provisions of the plans may impact current and future benefit costs. In accordance with the provisions of ASC 715, “Compensation – Retirement Benefits”, changes in benefit obligations associated with these factors may not be immediately recognized as costs in the statement of operations, but are recognized in future years over the expected average future service of the active employees or the average remaining life expectancies of inactive employees. |
Disclosures About Fair Value of Financial Instruments | Disclosures About Fair Value of Financial Instruments. Estimates of fair value for financial assets and liabilities are based on the framework established in the accounting guidance for fair value measurements. The framework defines fair value, provides guidance for measuring fair value and requires certain disclosures. The framework prioritizes a fair value hierarchy that requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The following three broad levels of inputs may be used to measure fair value under the fair value hierarchy: · Level 1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities. · Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. · Level 3: Significant unobservable inputs that cannot be corroborated by observable market data and reflect the use of significant management judgment. These values are generally determined using pricing models for which the assumptions utilize management’s estimates of market participant assumptions. If the inputs used to measure the financial assets and liabilities fall within more than one of the different levels described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument. During the reporting periods presented, the only asset or liability carried at fair value measured on a recurring basis was the long-term incentive plan accrual. The estimated fair value as of December 31, 2015 and March 31, 2015 was $130,000 and $730,000, respectively, which are considered level 3 measurements. The long-term incentive plan began on October 2, 2014 and is described in Note 5. The estimated fair value of the accrual is calculated on a quarterly basis using a Monte Carlo valuation model. Vesting is based on the probability of meeting the stock price criteria, the probability of which is considered in determining the estimated fair value. Remeasurements to fair value on a nonrecurring basis relate primarily to our property, plant and equipment and intangible assets and occur when the derived fair value is below their carrying value on our Consolidated Balance Sheet. We had no remeasurements of such assets to fair value in any of the periods covered in this report. The carrying amounts reported in the Consolidated Balance Sheets for cash and cash equivalents, accounts receivable, inventories, other current assets, accounts payable, accrued liabilities and convertible debt-related party approximate fair market value. |
Cash, Cash Equivalents and Marketable Securities | Cash, Cash Equivalents and Marketable Securities. We consider all cash on-hand and highly liquid investments with original maturities of three months or less when purchased to be cash equivalents. We classify marketable securities having original maturities of more than three months when purchased and remaining maturities of one year or less as short-term investments and marketable securities with remaining maturities of more than one year as long-term investments. We further classify marketable securities as either held-to-maturity or available-for-sale. We classify marketable securities as held-to-maturity when we believe we have the ability and intent to hold such securities to their scheduled maturity dates. All other marketable securities are classified as available-for-sale. We have not designated any of our marketable securities as trading securities. We carry held-to-maturity marketable securities at their amortized cost and available-for-sale marketable securities at their fair value and report any unrealized appreciation or depreciation in the fair value of available-for-sale marketable securities in accumulated other comprehensive income (loss). We monitor our investment portfolio for any decline in fair value that is other-than-temporary and record any such impairment as an impairment loss. We recorded no impairment losses for other-than-temporary declines in the fair value of marketable securities in any of the periods covered in this report. Cash and cash equivalents include highly liquid money market funds and debt securities with original maturities of three months or less totaling $2.0 million and $9.3 million at December 31 2015, and March 31, 2015, respectively. Money market funds present negligible risk of changes in value due to changes in interest rates, and their cost approximates their fair market value. We maintain cash in bank accounts, which, at times, may exceed federally insured limits. We have not experienced any losses in such accounts. Cash and cash equivalents held in foreign bank accounts totaled $507,000 and $896,000 at December 31, 2015 and March 31, 2015, respectively. |
Accounts Receivable | Accounts Receivable. We grant credit to our customers in the normal course of business and, generally, do not require collateral or any other security to support amounts due. If necessary, we have an outside party assist us with performing credit and reference checks and establishing credit limits for the customer. Concentration of credit risk with respect to accounts receivable relates to certain domestic and international customers to whom we make substantial sales. To reduce risk, we routinely assess the financial strength of our customers and, when appropriate, we obtain advance payments for our international sales. As a consequence, we believe that our accounts receivable credit risk exposure is limited. Historically we have not experienced any significant credit losses related to any individual customer or group of customers in any particular industry or geographic area. Accounts outstanding longer than the contractual payment terms, are considered past due. We carry our accounts receivable at the original invoice amount less an estimated allowance for doubtful receivables based on a periodic review of all outstanding amounts. We determine the allowance for doubtful accounts based on the customer’s financial health, and both historical and expected credit loss experience. We write off our accounts receivable when we deem them uncollectible. We record recoveries of accounts receivable previously written off when received. We are not always able to timely anticipate changes in the financial condition of our customers and if circumstances related to these customers deteriorate, our estimates of the recoverability of accounts receivable could be materially affected and we may be required to record additional allowances. Alternatively, if more allowances are provided than are ultimately required, we may reverse a portion of such provisions in future periods based on the actual collection experience. Historically, the accounts receivable balances we have written off have generally been within our expectations. The allowance for doubtful accounts was $68,000 and $33,000 at December 31, 2015, and March 31, 2015, respectively. |
Inventories | Inventories. We state inventories at the lower of cost or market using the first-in, first-out method. We value at lower of cost or market the slow moving and obsolete inventories based upon current and expected future product sales and the expected impact of product transitions or modifications. Historically, the inventory write-offs have generally been within our expectations. Inventories consist of the following: 12/31/15 3/31/15 Raw materials $ 2,385,000 $ 3,156,000 Work-in-process 793,000 527,000 Finished goods 1,407,000 1,143,000 $ 4,585,000 $ 4,826,000 Inventories acquired in a business combination are recorded at their estimated fair value less profit for sales efforts and expensed in cost of sales as that inventory is sold. As of March 31, 2015, the purchase accounting adjustment of $240,000 related to VSCI inventory was recorded in cost of goods sold over approximately the first four months of the transition period ended December 31, 2015. |
Property, Plant, and Equipment | Property, Plant and Equipment. We carry property, plant and equipment, including leasehold improvements, at cost, less accumulated depreciation or fair value if acquired in a business combination, which consists of the following balances: 12/31/15 3/31/15 Land $ 133,000 $ 133,000 Building 610,000 606,000 Leasehold improvements 1,222,000 807,000 Internal use software 782,000 749,000 Equipment 3,042,000 6,888,000 $ 5,789,000 $ 9,183,000 Less accumulated depreciation and amortization (3,234,000 ) (7,370,000 ) $ 2,555,000 $ 1,813,000 We provide for depreciation using the straight-line method over useful lives of three to seven years for equipment and 40 years for the building. Certain products used as sales demonstration and service loaner equipment are transferred from inventory to machinery and equipment and are depreciated over 3 years. We charge maintenance and repairs to expense as incurred. We capitalize improvements and amortize them over the shorter of their estimated useful service lives or the remaining lease term. We recognized depreciation expense of approximately $672,000 in the nine-month transition period ended December 31, 2015, $183,000 in the nine-months ended December 31, 2014 and $249,000 and $323,000 in the fiscal years ended March 31, 2015 and 2014, respectively. We capitalized internal use software and web site development costs of approximately $34,000 in the nine-month transition period ended December 31, 2015, $66,000 in the nine-month period ended December 31, 2014, and $185,000 and $25,000 in fiscal 2015 and 2014, respectively. These costs are amortized over a three-year period. The net book value of our capitalized software for internal use was approximately $183,000 and $183,000 at December 31, 2015 and March 31, 2015, respectively. |
Goodwill | Goodwill. Goodwill results from the Merger and represents the excess of the purchase price over the fair value of acquired tangible assets and liabilities and identifiable intangible assets. Annually on November 30 or if conditions indicate an additional review is necessary, the Company assesses qualitative factors to determine if it is more likely than not that the fair value of a reporting unit is less than its carrying amount and if it is necessary to perform the quantitative two-step goodwill impairment test. If the Company performs the quantitative test, it compares the carrying value of the reporting unit to an estimate of the reporting unit’s fair value to identify potential impairment. The fair value of each reporting unit is estimated using a discounted cash flow model. Where available, and as appropriate, comparable market multiples are also used to corroborate the results of the discounted cash flow models. In determining the estimated future cash flow, the Company considers and applies certain estimates and judgments, including current and projected future levels of income based on management’s plans, business trends, prospects and market and economic conditions and market-participant considerations. If the estimated fair value of the reporting unit is less than the carrying value, a second step is performed to determine the amount of the potential goodwill impairment. If impaired, goodwill is written down to its estimated implied fair value. For the November 30, 2015 annual impairment test, the Company performed step one of the two-step goodwill impairment test. Based on the results of the step one analysis, the Company concluded that the fair value of its reporting unit was substantially in excess of the carrying value. There was no goodwill impairment loss for the nine-month transition period ended December 31, 2015. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets. Long-lived assets consist of property, plant and equipment and intangible assets. We review our long-lived assets for impairment whenever events or business circumstances indicate that we may not recover the carrying amount of an asset. We measure recoverability of assets held and used from a comparison of the carrying amount of an asset to future undiscounted net cash flows we expect to generate by the asset. If we consider such assets impaired, we measure the impairment recognized by the amount by which the carrying amount of the assets exceeds the fair value of the assets. We completed our impairment analysis and concluded there were no impairments in any of the periods covered in this report. |
Product Warranty | Product Warranty. We warrant our products to be free from defects in material and workmanship under normal use and service for a period of twelve months after the date of sale. Under the terms of these warranties, we repair or replace products we deem defective due to material or workmanship. The following table summarizes changes in our warranty reserve: 12/31/15 3/31/15 Warranty reserve at beginning of period $ 146,000 $ 9,000 Warranties accrued during the period 50,000 1,000 Warranties settled during the period (50,000 ) - Warranty reserve for VSCI - 136,000 Warranty reserve at end of period $ 146,000 $ 146,000 |
Other Liabilities | Other Liabilities. Other liabilities consist of the following: 12/31/15 3/31/15 Investment banking fee payable - 1,750,000 Sales tax and VAT payable 243,000 261,000 Accrued legal and accounting fees 69,000 189,000 Deferred rent - 148,000 Deferred revenue 308,000 - Other accrued expenses 329,000 102,000 $ 949,000 $ 2,450,000 |
Foreign Currency Translation | Foreign Currency Translation. We translate all assets and liabilities of our foreign subsidiaries using period-end exchange rates. We translate statements of operations items using average exchange rates for the period. We record the resulting translation adjustment within accumulated other comprehensive loss, a separate component of shareholders’ equity. We recognize foreign currency transaction gains and losses in our consolidated statements of operations, including unrealized gains and losses on short-term intercompany obligations using period-end exchange rates. We recognize foreign currency transaction gains and losses primarily as a result of fluctuations in currency rates between the U.S. dollar (the functional reporting currency) and the Euro and British pound (currencies of our subsidiaries), as well as their effect on the dollar denominated intercompany obligations between us and our foreign subsidiaries. All intercompany balances are revolving in nature and we do not deem any portion of them to be long-term. We recognized foreign currency transaction gains and losses of approximately $(14,000) in the nine-month transition period ended December 31, 2015, $(3,000) in the nine months ended December 31, 2014 and $(4,000) and $(5,000) in the fiscal years ended March 31, 2015 and 2014, respectively. |
Income Taxes | Income Taxes. We account for income taxes using the asset and liability method. The asset and liability method provides that deferred tax assets and liabilities be recorded based on the differences between the tax basis of assets and liabilities and their carrying amounts for financial reporting purposes. We reduce deferred tax assets by a valuation allowance, when we believe it is more likely than not that some portion or all of the deferred tax assets will not be realized. ASC 740, “ Accounting for Income Taxes Under our accounting policies we recognize interest and penalties accrued on unrecognized tax benefits as well as interest received from favorable tax settlements within income tax expense. |
Basic and Diluted Net Loss per Share | Basic and Diluted Net Loss per Share. We calculate basic net loss per common share amounts by dividing net loss by the weighted-average common shares outstanding, excluding outstanding shares contingently subject to forfeiture. For calculating diluted net loss per common share amounts, we add additional shares to the weighted-average common shares outstanding for the assumed exercise of stock options and vesting of restricted shares, if dilutive. Because we have had net losses, the following options and warrants outstanding and unvested restricted stock to purchase shares of our common stock were excluded from diluted net loss per common share because of their anti-dilutive effect, and therefore, basic net loss per common share equals dilutive net loss per common share: Number of options, warrants and unvested restricted stock Range of exercise prices Period ended: Nine-months December 31, 2015 3,637,000 $1.64 - $24.40 Nine-months December 31, 2014 2,285,000 $2.84 - $24.40 March 31, 2015 2,569,000 $2.70 - $24.40 March 31, 2014 2,476,000 $1.06 - $24.40 March 31, 2013 2,196,000 $1.06 - $24.40 |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements In 2015, the Company adopted Accounting Standards Update (“ASU”) 2015-03, Interest – Imputation of Interest (Subtopic 835-30) – Simplifying the Presentation of Debt Issuance Costs. The amendments in this update require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of the debt liability. The Company adopted this standard in conjunction with obtaining its new loan facility. There was no impact of the retrospective adoption to prior periods. |
Recently Issued Accounting Pronouncements Not Yet Adopted | Recently Issued Accounting Pronouncements Not Yet Adopted. In February 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-2, Leases, under which lessees will recognize most leases on-balance sheet. This will generally increase reported assets and liabilities. For public entities, this ASU is effective for annual and interim periods in fiscal years beginning after December 15, 2018. ASU 2016-2 mandates a modified retrospective transition method for all entities. The Company will begin the process of determining the impact this ASU will have on the Company’s consolidated financial statements. In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes, In September 2015, the FASB issued ASU No. 2015-16, “Business Combinations (Topic 805).” The amendments in this update require that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. Under the new guidance, the acquirer should record, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization, or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date. On the face of the income statement or in the notes, the portion of the amount recorded in current-period earnings by line item that would have been recorded in previous reporting periods need to be reflected as if the adjustment to the provisional amounts had been recognized as of the acquisition date. The amendments in ASU No. 2016-16 are effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. We do not believe the adoption of this update will have a material impact on our consolidated financial statements. In July 2015, the FASB issued ASU No. 2015-12, “Plan Accounting: Defined Benefit Pension Plans (Topic 815).” Under the new guidance, plans are no longer required to measure fully benefit-responsive investment contracts (FBRICs) at fair value, disaggregate investments by nature, risks and characteristics, disclose individual investments that represent five percent or more of net assets available for benefits, or disclose net appreciation or depreciation for investments by general price. The amendments in ASU No. 2015-12 are effective for fiscal years beginning after December 15, 2015 and earlier adoption is permitted. We are still evaluating whether or not this update is applicable to our business. In July 2015, the FASB issued ASU No. 2015-11, “Simplifying the Measurement of Inventory (Topic 330).” Under the current guidance (i.e., ASC 330-10-352 before the ASU), an entity subsequently measures inventory at the lower of cost or market, with market defined as replacement cost, net realizable value (NRV), or NRV less a normal profit margin. An entity uses current replacement cost provided that it is not above NRV (i.e., the ceiling) or below NRV less an “approximately normal profit margin” (i.e., the floor). The new guidance requires entities to measure most inventory “at the lower of cost and net realizable value,” thereby simplifying the current guidance under which an entity must measure inventory at the lower of cost or market (market in this context is defined as one of three different measures). The ASU will not apply to inventories that are measured by using either the last-in, first-out (LIFO) method or the retail inventory method (RIM). The amendments in ASU No. 2015-11 are effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years. We do not believe the adoption of this update will have a material impact on our consolidated financial statements. In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606), as amended by ASU 2015-14, “Deferral of Effective Date, which requires an entity to recognize revenue 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. ASU 2014-09 sets forth a new revenue recognition model that requires identifying the contract, identifying the performance obligations, determining the transaction price, allocating the transaction price to performance obligations and recognizing the revenue upon satisfaction of performance obligations. For public entities, this ASU is effective for annual reporting periods beginning after December 15, 2017 including interim reporting periods within that reporting period. The provisions can be adopted either retrospectively to each prior reporting period presented or as a cumulative-effect adjustment as of the date of adoption. The Company is currently in the process of determining the impact that this ASU will have on the consolidated financial statements and its method of adoption. |
Summary of Significant Accoun20
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Dec. 31, 2015 | |
Summary of Significant Accounting Policies [Abstract] | |
Inventories | Inventories consist of the following: 12/31/15 3/31/15 Raw materials $ 2,385,000 $ 3,156,000 Work-in-process 793,000 527,000 Finished goods 1,407,000 1,143,000 $ 4,585,000 $ 4,826,000 |
Components of Property, Plant, and Equipment | We carry property, plant and equipment, including leasehold improvements, at cost, less accumulated depreciation or fair value if acquired in a business combination, which consists of the following balances: 12/31/15 3/31/15 Land $ 133,000 $ 133,000 Building 610,000 606,000 Leasehold improvements 1,222,000 807,000 Internal use software 782,000 749,000 Equipment 3,042,000 6,888,000 $ 5,789,000 $ 9,183,000 Less accumulated depreciation and amortization (3,234,000 ) (7,370,000 ) $ 2,555,000 $ 1,813,000 |
Summary of Changes in Warranty Reserve | The following table summarizes changes in our warranty reserve: 12/31/15 3/31/15 Warranty reserve at beginning of period $ 146,000 $ 9,000 Warranties accrued during the period 50,000 1,000 Warranties settled during the period (50,000 ) - Warranty reserve for VSCI - 136,000 Warranty reserve at end of period $ 146,000 $ 146,000 |
Other Liabilities | Other liabilities consist of the following: 12/31/15 3/31/15 Investment banking fee payable - 1,750,000 Sales tax and VAT payable 243,000 261,000 Accrued legal and accounting fees 69,000 189,000 Deferred rent - 148,000 Deferred revenue 308,000 - Other accrued expenses 329,000 102,000 $ 949,000 $ 2,450,000 |
Anti-dilutive Securities Excluded from Diluted Loss per Common Share | We calculate basic net loss per common share amounts by dividing net loss by the weighted-average common shares outstanding, excluding outstanding shares contingently subject to forfeiture. For calculating diluted net loss per common share amounts, we add additional shares to the weighted-average common shares outstanding for the assumed exercise of stock options and vesting of restricted shares, if dilutive. Because we have had net losses, the following options and warrants outstanding and unvested restricted stock to purchase shares of our common stock were excluded from diluted net loss per common share because of their anti-dilutive effect, and therefore, basic net loss per common share equals dilutive net loss per common share: Number of options, warrants and unvested restricted stock Range of exercise prices Period ended: Nine-months December 31, 2015 3,637,000 $1.64 - $24.40 Nine-months December 31, 2014 2,285,000 $2.84 - $24.40 March 31, 2015 2,569,000 $2.70 - $24.40 March 31, 2014 2,476,000 $1.06 - $24.40 March 31, 2013 2,196,000 $1.06 - $24.40 |
Business Combinations-Merger 21
Business Combinations-Merger Between Uroplasty, Inc and Vision-Sciences, Inc (Tables) | 9 Months Ended |
Dec. 31, 2015 | |
Business Combinations-Merger Between Uroplasty, Inc and Vision-Sciences, Inc [Abstract] | |
Schedule of Allocation of Purchase Price to Assets Acquired and Liabilities Assumed | The allocation was finalized without any change to the preliminary allocation and is as follows: Cash and cash equivalents $ 2,020,000 Accounts receivable 4,249,000 Inventories 4,462,000 Other current assets 369,000 Property, plant and equipment 817,000 Goodwill 18,750,000 Other intangibles 13,660,000 Other non-current assets 97,000 Total assets acquired 44,424,000 Accounts payable and other liabilities 5,209,000 Deferred revenue 176,000 Convertible debt – related party 22,530,000 Other non-current liabilities 40,000 Total liabilities assumed 27,955,000 Total purchase price $ 16,469,000 |
Schedule of Recognition of Intangible Assets | The allocation of the purchase price to the net assets acquired and liabilities assumed resulted in the recognition of the following intangible assets: Amount Weighted Average Life-Years Developed technology $ 6,200,000 7 Customer relationships 7,270,000 5 Trade names 190,000 10 $ 13,660,000 |
Schedule of Supplemental Pro forma Combined Results of Operations | The supplemental unaudited pro forma net sales and net loss of the combined entity had the acquisition been completed on April 1, 2013: (Unaudited) December 31, Year ended March 31, 2014 2015 2014 Supplemental pro forma combined results of operations: Net sales $ 32,287,840 $ 44,973,000 $ 41,523,000 Net loss (10,239,430 ) (15,817,000 ) (21,477,000 ) Loss per share – basic and diluted $ (0.41 ) $ (0.62 ) $ (0.86 ) |
Schedule of Adjustments to Supplemental Pro forma Combined Results of Operations | Adjustments to the supplemental pro forma combined results of operations are as follows: (Unaudited) December 31, Year ended March 31, 2014 2015 2014 Increase in amortization of intangibles $ 1,751,000 $ 2,334,000 $ 2,464,000 Adjust expenses related to merger (transaction costs, inventory step-up, deferred revenue adjustment) (4,399,000 ) (4,399,000 ) 4,801,000 Interest expense imputed on debt 899,000 1,198,000 1,144,000 Increase (decrease) in net loss $ (1,749,000 ) $ (867,000 ) $ 8,409,000 |
Goodwill and Other Intangible22
Goodwill and Other Intangible Assets (Tables) | 9 Months Ended |
Dec. 31, 2015 | |
Goodwill and Other Intangible Assets [Abstract] | |
Schedule of Other Intangible Assets | Other intangible assets consisted of the following at reporting dates presented below: December 31, 2015 March 31, 2015 Gross Carrying Amount Accumulated Amortization Gross Carrying Amount Accumulated Amortization Developed technology $ 6,200,000 $ 664,000 $ 6,200,000 $ - Patents & trademarks 5,653,000 5,586,000 5,653,000 5,564,000 Trademarks and trade names 190,000 67,000 190,000 - Customer relationships 7,270,000 1,150,000 7,270,000 - 19,313,000 $ 7,467,000 19,313,000 $ 5,564,000 Accumulated amortization 7,467,000 5,564,000 Net book value of amortizable intangible assets $ 11,846,000 $ 13,749,000 |
Estimated Amortization Expense for all Intangible Assets | Estimated amortization expense for all intangible assets for the five years subsequent to December 31, 2015 is as follows: Year ending December 31, 2016 $ 2,348,000 2017 2,348,000 2018 2,348,000 2019 2,348,000 2020 587,000 |
Convertible Debt - Related Pa23
Convertible Debt - Related Party (Tables) | 9 Months Ended |
Dec. 31, 2015 | |
Convertible Debt - Related Party [Abstract] | |
Summary of Convertible Debt - Related Party | The following table is a summary of our convertible debt – related party: December 31, 2015 March 31, 2015 Gross Principal Amount Unamortized Debt Discount Net Amount Gross Principal Amount Unamortized Debt Discount Net Amount Note Payable A $ 20,000,000 $ (3,639,000 ) $ 16,361,000 $ 20,000,000 $ (4,210,000 ) $ 15,790,000 Note Payable B 3,500,000 (562,000 ) 2,938,000 3,500,000 (650,000 ) 2,850,000 Note Payable C 4,990,000 (952,000 ) 4,038,000 4,990,000 (1,101,000 ) 3,889,000 $ 28,490,000 $ (5,153,000 ) $ 23,337,000 $ 28,490,000 $ (5,961,000 ) $ 22,529,000 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 9 Months Ended |
Dec. 31, 2015 | |
Shareholders' Equity [Abstract] | |
Weighted-average Assumptions used to Value the Options Granted | We used the following weighted-average assumptions to value the options granted during the nine-month transition period ended December 31, 2015 and the fiscal years ended 2015 and 2014: December 31, 2015 March 31, 2015 March 31, 2014 Expected life, in years 3.84 3.29 4.51 Risk-free interest rate 1.11 % .74 % 1.36 % Expected volatility 63.9 % 63.4 % 89.1 % Expected dividend yield 0 % 0 % 0 % |
Stock Option Activity | The following table summarizes the activity related to our stock options for the nine-month transition period ended December 31, 2015 and fiscal 2015 and 2014: Number of shares Weighted average exercise price Weighted average grant date fair value Aggregate intrinsic value Weighted average remaining life in years Balance at March 31, 2013 1,464,866 $ 4.84 $ 882,989 2.64 Options granted 682,296 3.54 $ 2.36 Options exercised (251,410 ) 1.67 1,089,978 Options surrendered (204,203 ) 5.81 Balance at March 31, 2014 1,691,549 4.67 2,451,075 3.85 Options granted 135,070 4.73 1.26 Options exercised (61,761 ) 1.10 170,944 Options surrendered (469,466 ) 6.91 Balance at March 31, 2015 1,295,392 4.03 - 3.91 Options converted from VSCI 955,473 7.07 4.75 6.62 Balance at March 31, 2015 2,250,865 5.32 - 5.06 Options granted 617,914 1.64 0.79 Options exercised - Options surrendered (295,139 ) 5.08 Balance at December 31, 2015 2,573,640 4.46 - 5.24 Options exercisable at December 31, 2015 1,699,792 4.56 - 3.92 |
Restricted Shares Activity | The following table summarizes the activity related to our restricted stock for the nine-month transition period ended December 31, 2015 and fiscal 2015: Number of Shares Weighted average grant date fair value Weighted average remaining life in years Aggregate intrinsic value Balance at March 31, 2013 130,791 $ 6.05 1.50 $ 1,087,226 Shares granted 88,647 4.22 Shares vested (38,510 ) 5.69 304,148 Shares surrendered (74,652 ) 6.03 Balance at March 31, 2014 106,276 4.65 2.23 743,167 Shares granted 305,248 4.34 Shares vested (82,060 ) 4.41 185,957 Shares surrendered (11,723 ) 5.56 Balance at March 31, 2015 317,741 4.47 1.93 387,644 Shares granted 513,299 1.62 Shares vested (122,353 ) 4.42 157,835 Shares surrendered (21,777 ) 2.73 Balance at December 31, 2015 686,910 2.41 1.59 886,114 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Dec. 31, 2015 | |
Commitments and Contingencies [Abstract] | |
Future Minimum Lease Payments in Subsequent Fiscal Years Under Noncancelable Operating Leases | At December 31, 2015, the approximate future minimum lease payments in subsequent calendar years under noncancelable operating leases with an initial term in excess of one year are as follows: 2016 $ 744,000 2017 610,000 2018 339,000 2019 228,000 Thereafter 762,000 $ 2,683,000 |
Savings and Retirement Plans (T
Savings and Retirement Plans (Tables) | 9 Months Ended |
Dec. 31, 2015 | |
Defined Benefit Plan Disclosure [Line Items] | |
Allocation of Pension Plan Assets | The allocation of pension plan assets was as follows: December 31, 2015 March 31, 2015 Target Allocation Actual Allocation Target Allocation Actual Allocation Other Contract (Netherlands Plan) 100 % 100 % 100 % 100 % Deposit Administration Contract (U.K. Plan) 100 % 100 % 100 % 100 % |
Fair value of Pension Plan Assets | The fair value of the pension plan assets by asset class is as follows: Asset Class Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) December 31, 2015 Other Contract (Netherlands Plan) $ 3,002,000 $ (3,000 ) $ - $ 3,005,000 Deposit Administration Contract (U.K. Plan) 775,000 - 775,000 - March 31, 2015 Other Contract (Netherlands Plan) $ 3,593,000 $ 15,000 $ - $ 3,578,000 Deposit Administration Contract (U.K. Plan) 730,000 - 730,000 - |
Reconciliation of Beginning and Ending Balances for Level 3 Assets | The reconciliation of beginning and ending balances for our Level 3 assets is as follows: Other Contract (Netherlands Pension Plan Assets) Beginning balance as at April 1, 2015 $ 3,578,000 Loss recognized in earnings 38,000 Actuarial Loss (713,000 ) Purchases 76,000 Sales (16,000 ) Transfers 16,000 Foreign currency translation 26,000 Ending balance as at December 31, 2015 $ 3,005,000 |
The Netherlands Defined Benefit Plan [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
Benefit Payments in Subsequent Fiscal Years | At December 31, 2015, we project the following benefit payments in subsequent years: 2016 $ 21,000 2017 21,000 2018 21,000 2019 26,000 2020 26,000 2021 to 2025 156,000 $ 271,000 |
Summary of the Changes in Benefit Obligations and the Change in Plan Assets | The following table summarizes the change in benefit obligations and the change in plan assets: Nine months ended December 31, 2015 Fiscal year ended March 31, 2015 Changes in benefit obligations: Projected benefit obligation, beginning of period $ 4,465,000 $ 3,343,000 Service cost 109,000 133,000 Interest cost 51,000 102,000 Benefits paid (16,000 ) (7,000 ) Plan amendment - (110,000 ) Actuarial result (977,000 ) 2,006,000 Foreign currency translation 33,000 (1,002,000 ) Projected benefit obligation, end of period $ 3,665,000 $ 4,465,000 Changes in plan assets: Plan assets, beginning of period $ 3,593,000 $ 2,665,000 Contributions to plan 73,000 147,000 Management cost (4,000 ) (10,000 ) Actual return on assets (670,000 ) 1,603,000 Benefits paid (16,000 ) (7,000 ) Foreign currency translation 26,000 (805,000 ) Plan assets, end of period $ 3,002,000 $ 3,593,000 |
Amount Recognized in Other Comprehensive Loss | The amount recognized in other comprehensive loss consists of: Nine months ended December 31, 2015 Fiscal Year 2015 Unrecognized net prior service benefit $ (313,000 ) $ (339,000 ) Unrecognized net losses 656,000 941,000 Additional other comprehensive loss (gross of income taxes) $ 343,000 $ 602,000 |
Projected Benefit Obligation, Accumulated Benefit Obligations and the Fair Value Plan Assets | The projected benefit obligation, accumulated benefit obligations and the fair value plan were as follows: December 31, 2015 March 31, 2015 Projected benefit obligation $ 3,665,000 $ 4,465,000 Accumulated benefit obligation 3,107,000 3,710,000 Fair value of plan assets 3,002,000 3,593,000 |
Components of Benefit Costs for Defined Benefit Retirement Plans | The cost of our defined benefit retirement plan includes the following components: Nine months ended December 31, 2015 Nine months ended December 31, 2014 Fiscal Year 2015 Fiscal Year 2014 Gross service cost, net of employee contribution $ 98,000 $ 92,000 $ 118,000 $ 113,000 Interest cost 51,000 81,000 102,000 108,000 Management cost 6,000 8,000 11,000 11,000 Expected return on assets (42,000 ) (58,000 ) (72,000 ) (72,000 ) Amortization 1,000 (1,000 ) (2,000 ) - Net periodic retirement cost $ 114,000 122,000 $ 157,000 $ 160,000 |
Major Assumptions Used in Calculations | Major assumptions used in the above calculations include: December 31, 2015 March 31, 2015 Discount rate 2.40 % 1.50 % Expected return on assets 2.40 % 1.50 % Expected rate of increase in future compensation: General 2.5 % 2.5 % Individual 0-3 % 0-3 % |
The UK Defined Benefit Plan [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
Benefit Payments in Subsequent Fiscal Years | At December 31, 2015 we project the following benefit payments in subsequent years: 2016 $ 83,000 2017 28,000 2018 160,000 2019 53,000 2020 - 2021 to 2025 783,000 $ 1,107,000 |
Summary of the Changes in Benefit Obligations and the Change in Plan Assets | The following table summarizes the change in benefit obligations and the change in plan assets: Nine months ended December 31, 2015 Fiscal Year March 31, 2015 Changes in benefit obligations: Projected benefit obligation, beginning of period $ 814,000 $ 755,000 Service cost 4,000 5,000 Interest cost 21,000 34,000 Other (4,000 ) (5,000 ) Actuarial result (91,000 ) 119,000 Foreign currency translation - (94,000 ) Projected benefit obligation, end of period $ 744,000 $ 814,000 Changes in plan assets: Plan assets, beginning of period $ 730,000 $ 756,000 Contributions to plan 33,000 45,000 Management cost (4,000 ) (5,000 ) Actual return on assets 19,000 21,000 Foreign currency translation (3,000 ) (87,000 ) Plan assets, end of period $ 775,000 $ 730,000 |
Amount Recognized in Other Comprehensive Loss | The amount recognized in other comprehensive loss consists of: Nine months ended December 31, 2015 Fiscal year 2015 Unrecognized net losses (gross of deferred taxes) $ 116,000 $ 228,000 |
Projected Benefit Obligation, Accumulated Benefit Obligations and the Fair Value Plan Assets | The projected benefit obligation, accumulated benefit obligation and the fair value plan assets were as follows: December 31, 2015 March 31, 2015 Projected benefit obligation $ 744,000 $ 814,000 Accumulated benefit obligation 744,000 814,000 Fair value of plan assets 775,000 730,000 |
Components of Benefit Costs for Defined Benefit Retirement Plans | The cost of our defined benefit retirement plan includes the following components for the years ended: Nine months ended December 31, 2015 Nine months ended December 31, 2014 Fiscal Year 2015 Fiscal Year, 2014 Gross service cost, net of employee contribution $ 4,000 $ 4,000 $ 5,000 $ 5,000 Interest cost 21,000 25,000 34,000 33,000 Expected return on assets (15,000 ) (21,000 ) (28,000 ) (21,000 ) Amortization 19,000 4,000 5,000 7,000 Net periodic retirement cost $ 29,000 12,000 $ 16,000 $ 24,000 |
Major Assumptions Used in Calculations | Major assumptions used in the above calculations include: December 31, 2015 March 31, 2015 Discount rate 4.00 % 3.40 % Expected return on assets 3.00 % 2.60 % |
Income Taxes (Tables)
Income Taxes (Tables) | 9 Months Ended |
Dec. 31, 2015 | |
Income Taxes [Abstract] | |
Components of Income Tax Expense | The components of income tax expense consist of the following: 9 months 12/31/2015 9 months 12/31/2014 Fiscal year 3/31/2015 Fiscal year 3/31/2014 Income tax provision: Current: Federal and state 14,000 10,000 8,000 13,000 Foreign 35,000 24,000 55,000 45,000 Deferred: Federal and state - - - - Foreign (9,000 ) 22,000 3,000 14,000 Total income tax expense $ 40,000 $ 56,000 $ 66,000 $ 72,000 |
Income Tax Expense Differs from Statutory Federal Income Tax Benefit | Actual income tax expense differs from statutory federal income tax benefit for the period presented is as follows: 9 months 12/31/2015 9 months 12/31/2014 Fiscal year 3/31/2015 Fiscal year 3/31/2014 Statutory federal income tax benefit $ (2,376,000 ) $ (1,809,000 ) $ (2,600,000 ) $ (1,799,000 ) State tax benefit, net of federal taxes (212,000 ) (163,000 ) (210,000 ) (125,000 ) Foreign tax (18,000 ) (32,000 ) (40,000 ) (39,000 ) Nondeductible expenses – other 92,000 91,000 126,000 122,000 Nondeductible exp – transaction costs 55,000 148,000 462,000 - Subpart F Income 20,000 26,000 33,000 35,000 Valuation allowance increase 1,377,000 1,946,000 2,478,000 1,007,000 Stock compensation shortfall 128,000 - - - Stock compensation true-up 83,000 132,000 132,000 267,000 NOL expiration and true-up 320,000 - (53,000 ) 307,000 Foreign tax credits - - - - Other 571,000 (283,000 ) (262,000 ) 297,000 Total income tax expense $ 40,000 $ 56,000 $ 66,000 $ 72,000 |
Deferred Tax Assets (Liabilities) | Deferred tax assets (liabilities) consist of the following: 12/31/2015 03/31/2015 Fixed assets $ (50,000 ) $ 400,000 Intangible assets (4,378,000 ) (5,086,000 ) Pension liability 135,000 199,000 Stock based compensation 1,661,000 1,624,000 Inventory 298,000 184,000 Debt discount (1,929,000 ) (1,881,000 ) Other reserves and accruals 437,000 564,000 Deferred rent 250,000 12,000 Undistributed foreign earnings (451,000 ) (429,000 ) Foreign tax credits 68,000 68,000 Net operating losses 20,812,000 19,885,000 16,853,000 15,540,000 Less valuation allowance (16,717,000 ) (15,340,000 ) $ 136,000 $ 200,000 |
Business Segment Information (T
Business Segment Information (Tables) | 9 Months Ended |
Dec. 31, 2015 | |
Business Segment Information [Abstract] | |
Sales to Customers and Long-lived Assets by Geographic Area | Information regarding geographic area net sales to customers for the nine-month transition period ended December 31, 2015, the nine months ended December 31, 2014, and for the fiscal years ended March 31, 2015 and 2014, respectively, is as follows: United States United Kingdom All Other Foreign Countries (1) Consolidated Nine-month transition period ended December 31, 2015 $ 27,236,000 $ 3,213,000 $ 6,173,000 $ 36,622,000 Nine months ended December 31, 2014 $ 14,512,000 $ 1,923,000 $ 3,071,000 $ 19,506,000 Fiscal year ended March 31, 2015 $ 19,970,000 $ 2,506,000 $ 4,050,000 $ 26,526,000 Fiscal year ended March 31, 2014 $ 18,042,000 $ 2,485,000 $ 4,050,000 $ 24,577,000 (1) No other foreign country accounts for 10% or more of the consolidated net sales Information regarding geographic area long-lived assets at December 31, 2015 and March 31, 2015 is as follows: United States United Kingdom The Netherlands Consolidated December 31, 2015 $ 2,089,000 $ 3,000 $ 463,000 $ 2,555,000 March 31, 2015 $ 1,338,000 $ 3,000 $ 472,000 $ 1,813,000 |
Summary of Significant Accoun29
Summary of Significant Accounting Policies (Details) | 9 Months Ended | 12 Months Ended | |||
Dec. 31, 2015USD ($)Company | Dec. 31, 2014USD ($) | Mar. 31, 2015USD ($) | Mar. 31, 2014USD ($) | Sep. 18, 2015USD ($) | |
Liquidity and Capital Resources [Abstract] | |||||
Cash equivalents and cash equivalents | $ 2,000,000 | ||||
Nature of Business [Abstract] | |||||
Number of companies merged | Company | 2 | ||||
Revenue Recognition [Abstract] | |||||
Maximum number of days for receipt of payment of good sold | 120 days | ||||
Advertising Expenses [Abstract] | |||||
Advertising expense | $ 383,000 | $ 325,000 | $ 437,000 | $ 595,000 | |
Uroplasty Inc ("UPI") [Member] | |||||
Nature of Business [Abstract] | |||||
Ownership percentage | 62.50% | ||||
Vision Sciences Inc ("VSCI") [Member] | |||||
Nature of Business [Abstract] | |||||
Ownership percentage | 37.50% | ||||
Reverse stock split ratio | 5 | ||||
Venture Bank [Member] | Revolving Credit Facility [Member] | |||||
Liquidity and Capital Resources [Abstract] | |||||
Line of credit | $ 7,000,000 |
Summary of Significant Accoun30
Summary of Significant Accounting Policies, Part 2 (Details) - USD ($) | Dec. 31, 2015 | Mar. 31, 2015 |
Cash, Cash Equivalents and Marketable Securities [Abstract] | ||
Money market funds and debt securities | $ 2,000,000 | $ 9,300,000 |
Cash and cash equivalents held in foreign bank accounts | 507,000 | 896,000 |
Accounts Receivable [Abstract] | ||
Allowance for doubtful accounts | 68,000 | 33,000 |
Inventories [Abstract] | ||
Raw materials | 2,385,000 | 3,156,000 |
Work-in-process | 793,000 | 527,000 |
Finished goods | 1,407,000 | 1,143,000 |
Inventories | 4,584,844 | 4,825,984 |
Inventory purchase accounting adjustments adjustments | 240,000 | |
Level 3 [Member] | ||
Disclosures About Fair Value of Financial Instruments [Abstract] | ||
Fair value of plan assets | $ 130,000 | $ 730,000 |
Summary of Significant Accoun31
Summary of Significant Accounting Policies, Part 3 (Details) - USD ($) | 9 Months Ended | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | |
Components of property, plant, and equipment [Abstract] | ||||
Property, plant and equipment, gross | $ 5,789,000 | $ 9,183,000 | ||
Less accumulated depreciation and amortization | (3,234,000) | (7,370,000) | ||
Property, plant and equipment, net | $ 2,554,822 | 1,813,343 | ||
Equipment transferred from inventory to machinery and equipment, deprecation period | 3 years | |||
Depreciation expense | $ 672,000 | $ 183,000 | 249,000 | $ 323,000 |
Capitalized internal use software and web site development costs | 34,000 | $ 66,000 | 185,000 | $ 25,000 |
Net book value of capitalized software | 183,000 | 183,000 | ||
Land [Member] | ||||
Components of property, plant, and equipment [Abstract] | ||||
Property, plant and equipment, gross | 133,000 | 133,000 | ||
Building [Member] | ||||
Components of property, plant, and equipment [Abstract] | ||||
Property, plant and equipment, gross | $ 610,000 | 606,000 | ||
Property, plant and equipment, useful life | 40 years | |||
Leasehold Improvements [Member] | ||||
Components of property, plant, and equipment [Abstract] | ||||
Property, plant and equipment, gross | $ 1,222,000 | 807,000 | ||
Internal Use Software [Member] | ||||
Components of property, plant, and equipment [Abstract] | ||||
Property, plant and equipment, gross | $ 782,000 | 749,000 | ||
Property, plant and equipment, useful life | 3 years | |||
Equipment [Member] | ||||
Components of property, plant, and equipment [Abstract] | ||||
Property, plant and equipment, gross | $ 3,042,000 | $ 6,888,000 | ||
Equipment [Member] | Minimum [Member] | ||||
Components of property, plant, and equipment [Abstract] | ||||
Property, plant and equipment, useful life | 3 years | |||
Equipment [Member] | Maximum [Member] | ||||
Components of property, plant, and equipment [Abstract] | ||||
Property, plant and equipment, useful life | 7 years |
Summary of Significant Accoun32
Summary of Significant Accounting Policies, Part 4 (Details) - USD ($) | 9 Months Ended | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | |
Goodwill [Abstract] | ||||
Goodwill impairment loss | $ 0 | |||
Impairment of Long Lived Assets [Abstract] | ||||
Impairment of long-lived assets | $ 0 | $ 0 | $ 0 | |
Product Warranty [Abstract] | ||||
Period of service of the product after the date of sale | 12 months | |||
Warranty Reserve [Abstract] | ||||
Warranty reserve at beginning of period | $ 146,000 | $ 9,000 | 9,000 | |
Warranties accrued during the fiscal year | 50,000 | 1,000 | ||
Warranties settled during the fiscal year | (50,000) | 0 | ||
Warranty reserve for VSCI | 0 | 136,000 | ||
Warranty reserve end of period | 146,000 | 146,000 | 9,000 | |
Other Liabilities [Abstract] | ||||
Investment banking fee payable | 0 | 1,750,000 | ||
Sales tax and VAT payable | 243,000 | 261,000 | ||
Accrued legal and accounting fees | 69,000 | 189,000 | ||
Deferred rent | 0 | 148,000 | ||
Deferred revenue | 308,000 | 0 | ||
Other accrued expenses | 329,000 | 102,000 | ||
Total other liabilities | 949,497 | 2,450,058 | ||
Foreign Currency Translation [Abstract] | ||||
Foreign currency exchange gain (loss) | $ (14,000) | $ (3,000) | $ (4,000) | $ (5,000) |
Summary of Significant Accoun33
Summary of Significant Accounting Policies, Part 5 (Details) - Options, Warrants and Unvested Restricted Stock [Member] - $ / shares | 9 Months Ended | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2013 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Number of anti-dilutive shares excluded from computation of diluted loss per common share (in shares) | 3,637,000 | 2,285,000 | 2,569,000 | 2,476,000 | 2,196,000 |
Range of exercise prices - lower range limit (in dollars per share) | $ 1.64 | $ 2.84 | $ 2.70 | $ 1.06 | $ 1.06 |
Range of exercise prices - upper range limit (in dollars per share) | $ 24.40 | $ 24.40 | $ 24.40 | $ 24.40 | $ 24.40 |
Business Combinations-Merger 34
Business Combinations-Merger Between Uroplasty, Inc and Vision-Sciences, Inc (Details) - USD ($) | 9 Months Ended | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets [Abstract] | ||||
Goodwill | $ 18,749,888 | $ 18,749,888 | ||
Vision-Sciences, Inc [Member] | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets [Abstract] | ||||
Cash and cash equivalents | 2,020,000 | |||
Accounts receivable | 4,249,000 | |||
Inventories | 4,462,000 | |||
Other current assets | 369,000 | |||
Property, plant and equipment | 817,000 | |||
Goodwill | 18,750,000 | |||
Other intangibles | 13,660,000 | |||
Other non-current assets | 97,000 | |||
Total assets acquired | 44,424,000 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities [Abstract] | ||||
Accounts payable and other liabilities | 5,209,000 | |||
Deferred revenue | 176,000 | |||
Convertible debt - related party | 22,530,000 | |||
Other non-current liabilities | 40,000 | |||
Total liabilities assumed | 27,955,000 | |||
Total purchase price | 16,469,000 | |||
Recognition of intangible assets [Abstract] | ||||
Other intangibles | 13,660,000 | |||
Supplemental pro forma combined results of operations [Abstract] | ||||
Net sales | $ 32,287,840 | 44,973,000 | $ 41,523,000 | |
Net loss | $ (10,239,430) | $ (15,817,000) | $ (21,477,000) | |
Loss per share - basic and diluted (in dollars per share) | $ (0.41) | $ (0.62) | $ (0.86) | |
Adjustments to supplemental pro forma combined results of operations [Abstract] | ||||
Increase in amortization of intangibles | $ 1,751,000 | $ 2,334,000 | $ 2,464,000 | |
Adjust expenses related to merger (transaction costs, inventory step-up, deferred revenue adjustment) | (4,399,000) | (4,399,000) | 4,801,000 | |
Interest expense imputed on debt | 899,000 | 1,198,000 | 1,144,000 | |
Increase (decrease) in net loss | $ (1,749,000) | $ (867,000) | $ 8,409,000 | |
Vision-Sciences, Inc [Member] | Developed Technology [Member] | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets [Abstract] | ||||
Other intangibles | 6,200,000 | |||
Recognition of intangible assets [Abstract] | ||||
Other intangibles | $ 6,200,000 | |||
Weighted Average Life-Years | 7 years | |||
Vision-Sciences, Inc [Member] | Customer Relationships [Member] | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets [Abstract] | ||||
Other intangibles | $ 7,270,000 | |||
Recognition of intangible assets [Abstract] | ||||
Other intangibles | $ 7,270,000 | |||
Weighted Average Life-Years | 5 years | |||
Vision-Sciences, Inc [Member] | Trade Names [Member] | ||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets [Abstract] | ||||
Other intangibles | $ 190,000 | |||
Recognition of intangible assets [Abstract] | ||||
Other intangibles | $ 190,000 | |||
Weighted Average Life-Years | 10 years |
Goodwill and Other Intangible35
Goodwill and Other Intangible Assets (Details) - USD ($) | 9 Months Ended | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | |
Goodwill and Other Intangible Assets [Abstract] | ||||
Amount of purchase price | $ 16,500,000 | |||
Goodwill | $ 18,749,888 | 18,749,888 | ||
Finite-Lived Intangible Assets [Line Items] | ||||
Gross carrying amount | 19,313,000 | 19,313,000 | ||
Accumulated amortization | 7,467,000 | 5,564,000 | ||
Net book value of amortizable intangible assets | 11,846,000 | 13,749,000 | ||
Amortization of intangible assets | $ 1,902,573 | $ 24,136 | 31,398 | $ 30,462 |
Weighted average remaining amortization period | 5 years | |||
Estimated amortization expense for all intangible assets [Abstract] | ||||
2,016 | $ 2,348,000 | |||
2,017 | 2,348,000 | |||
2,018 | 2,348,000 | |||
2,019 | 2,348,000 | |||
2,020 | 587,000 | |||
Developed Technology [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Gross carrying amount | 6,200,000 | 6,200,000 | ||
Accumulated amortization | 664,000 | 0 | ||
Patents & trademarks [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Gross carrying amount | 5,653,000 | 5,653,000 | ||
Accumulated amortization | 5,586,000 | 5,564,000 | ||
Trademarks and Trade Names [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Gross carrying amount | 190,000 | 190,000 | ||
Accumulated amortization | 67,000 | 0 | ||
Customer Relationships [Member] | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Gross carrying amount | 7,270,000 | 7,270,000 | ||
Accumulated amortization | $ 1,150,000 | $ 0 |
Convertible Debt - Related Pa36
Convertible Debt - Related Party (Details) - USD ($) | 9 Months Ended | |
Dec. 31, 2015 | Mar. 31, 2015 | |
Convertible Debt - Related Party [Abstract] | ||
Net Amount | $ 23,336,854 | $ 22,529,497 |
Accrued interest | $ 758,000 | |
Maturity date | Mar. 31, 2020 | |
Number of days notice for conversion of debt | 15 days | |
Face value of debt | $ 5,960,000 | |
Effective interest rate | 4.72% | |
Risk free rate | 1.37% | |
Market interest rate | 10.30% | |
Annualized volatility | 65.00% | |
Minimum [Member] | ||
Convertible Debt - Related Party [Abstract] | ||
Conversion period | 3 years | |
Convertible Debt [Member] | ||
Convertible Debt - Related Party [Abstract] | ||
Gross Principal Amount | $ 28,490,000 | 28,490,000 |
Unamortized Debt Discount | (5,153,000) | (5,961,000) |
Net Amount | 23,337,000 | 22,529,000 |
Convertible Debt [Member] | Note Payable A [Member] | ||
Convertible Debt - Related Party [Abstract] | ||
Gross Principal Amount | 20,000,000 | 20,000,000 |
Unamortized Debt Discount | (3,639,000) | (4,210,000) |
Net Amount | $ 16,361,000 | 15,790,000 |
Annual interest rate | 0.84% | |
Debt conversion price (in dollars per share) | $ 6 | |
Convertible Debt [Member] | Note Payable B [Member] | ||
Convertible Debt - Related Party [Abstract] | ||
Gross Principal Amount | $ 3,500,000 | 3,500,000 |
Unamortized Debt Discount | (562,000) | (650,000) |
Net Amount | $ 2,938,000 | 2,850,000 |
Annual interest rate | 1.66% | |
Debt conversion price (in dollars per share) | $ 4.45 | |
Convertible Debt [Member] | Note Payable C [Member] | ||
Convertible Debt - Related Party [Abstract] | ||
Gross Principal Amount | $ 4,990,000 | 4,990,000 |
Unamortized Debt Discount | (952,000) | (1,101,000) |
Net Amount | $ 4,038,000 | $ 3,889,000 |
Annual interest rate | 1.91% | |
Debt conversion price (in dollars per share) | $ 5.55 |
Shareholders' Equity (Details)
Shareholders' Equity (Details) | 9 Months Ended | 12 Months Ended | |||||
Dec. 31, 2015USD ($)Plan$ / sharesshares | Dec. 31, 2014USD ($)$ / sharesshares | Mar. 31, 2015USD ($)$ / sharesshares | Mar. 31, 2014USD ($)$ / sharesshares | Mar. 31, 2013USD ($)$ / sharesshares | Mar. 31, 2012 | Jul. 23, 2013shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock grants (in shares) | 26,057,327 | 25,676,212 | |||||
Fully vested options outstanding (in shares) | 217,986 | ||||||
Share-based compensation expense | $ | $ 979,000 | $ 1,389,000 | $ 1,436,000 | ||||
Stock options, additional disclosures [Abstract] | |||||||
Proceeds from stock options exercised | $ | 0 | $ 67,850 | $ 67,850 | $ 359,510 | |||
Restricted shares and warrants, additional disclosures [Abstract] | |||||||
Unrecognized share-based compensation expense | $ | $ 1,104,000 | ||||||
Unrecognized compensation expense, weighted average period of recognition | 2 years | ||||||
Warrants issued to purchase common stock (in shares) | 376,123 | ||||||
Warrants exercise price (in dollars per share) | $ / shares | $ 9.31 | ||||||
Stock Options [Member] | |||||||
Weighted-average assumptions used to value the options granted [Abstract] | |||||||
Expected life, in years | 3 years 10 months 2 days | 3 years 3 months 14 days | 4 years 6 months 4 days | ||||
Risk-free interest rate | 1.11% | 0.74% | 1.36% | ||||
Expected volatility | 63.90% | 63.40% | 89.10% | ||||
Expected dividend yield | 0.00% | 0.00% | 0.00% | ||||
Stock options, number of shares [Roll Forward] | |||||||
Outstanding, beginning of period (in shares) | 2,250,865 | 1,691,549 | 1,691,549 | 1,464,866 | |||
Options granted (in shares) | 617,914 | 135,070 | 682,296 | ||||
Options exercised (in shares) | 0 | (61,761) | (251,410) | ||||
Options surrendered (in shares) | (295,139) | (469,466) | (204,203) | ||||
Outstanding, end of period before conversion (in shares) | 1,295,392 | ||||||
Options converted from VSCI (in shares) | 955,473 | ||||||
Outstanding, end of period (in shares) | 2,573,640 | 2,250,865 | 1,691,549 | 1,464,866 | |||
Exercisable, end of period (in shares) | 1,699,792 | ||||||
Stock options, weighted average exercise price [Roll Forward] | |||||||
Outstanding, beginning of period (in dollars per share) | $ / shares | $ 5.32 | $ 4.67 | $ 4.67 | $ 4.84 | |||
Options granted (in dollars per share) | $ / shares | 1.64 | 4.73 | 3.54 | ||||
Options exercised (in dollars per share) | $ / shares | 1.10 | 1.67 | |||||
Options surrendered (in dollars per share) | $ / shares | 5.08 | 6.91 | 5.81 | ||||
Outstanding, end of period before conversion (in dollars per share) | $ / shares | 4.03 | ||||||
Options converted from VSCI, (in dollars per share) | $ / shares | 7.07 | ||||||
Outstanding, end of period (in dollars per share) | $ / shares | 4.46 | 5.32 | 4.67 | $ 4.84 | |||
Exercisable, end of period (in dollars per share) | $ / shares | 4.56 | ||||||
Stock options, additional disclosures [Abstract] | |||||||
Weighted-average grant date fair value (in dollars per share) | $ / shares | $ 0.79 | 1.26 | $ 2.36 | ||||
Options converted from VSCI, weighted-average grant date fair value (in dollars per share) | $ / shares | $ 4.75 | ||||||
Outstanding, Aggregate intrinsic value, end of period | $ | $ 0 | $ 0 | $ 2,451,075 | $ 882,989 | |||
Options exercised, Aggregate intrinsic value | $ | $ 170,944 | $ 1,089,978 | |||||
Exercisable, Aggregate intrinsic value, end of period | $ | $ 0 | ||||||
Outstanding, Weighted average remaining life in years | 5 years 2 months 26 days | 5 years 22 days | 3 years 10 months 6 days | 2 years 7 months 20 days | |||
Options exercisable, Weighted average remaining life in years before conversion | 3 years 10 months 28 days | ||||||
Options converted from VSCI, Weighted average remaining life in years | 6 years 7 months 13 days | ||||||
Options exercisable, Weighted average remaining life in years | 3 years 11 months 1 day | ||||||
Fair value of stock options vested | $ | $ 519,000 | $ 723,000 | $ 441,000 | ||||
Proceeds from stock options exercised | $ | $ 0 | $ 68,000 | $ 360,000 | ||||
Stock Options [Member] | Executive Employees and Directors [Member] | |||||||
Weighted-average assumptions used to value the options granted [Abstract] | |||||||
Forfeiture rate | 10.00% | ||||||
Stock Options [Member] | Non-Executive Employees [Member] | |||||||
Weighted-average assumptions used to value the options granted [Abstract] | |||||||
Forfeiture rate | 15.00% | ||||||
Restricted Stock [Member] | |||||||
Restricted shares and warrants, number of shares [Roll Forward] | |||||||
Balance, beginning of period (in shares) | 317,741 | 106,276 | 106,276 | 130,791 | |||
Shares granted (in shares) | 513,299 | 305,248 | 88,647 | ||||
Shares vested (in shares) | (122,353) | (82,060) | (38,510) | ||||
Shares surrendered (in shares) | (21,777) | (11,723) | (74,652) | ||||
Balance, end of period (in shares) | 686,910 | 317,741 | 106,276 | 130,791 | |||
Restricted shares, weighted average grant date fair value [Roll Forward] | |||||||
Balance, beginning of period (in dollars per share) | $ / shares | $ 4.47 | $ 4.65 | $ 4.65 | $ 6.05 | |||
Shares granted (in dollars per share) | $ / shares | 1.62 | 4.34 | 4.22 | ||||
Shares vested (in dollars per share) | $ / shares | 4.42 | 4.41 | 5.69 | ||||
Shares surrendered (in dollars per share) | $ / shares | 2.73 | 5.56 | 6.03 | ||||
Balance, end of period (in dollars per share) | $ / shares | $ 2.41 | $ 4.47 | $ 4.65 | $ 6.05 | |||
Restricted shares and warrants, additional disclosures [Abstract] | |||||||
Weighted average remaining life in years | 1 year 7 months 2 days | 1 year 11 months 5 days | 2 years 2 months 23 days | 1 year 6 months | |||
Shares vested, Aggregate intrinsic value | $ | $ 157,835 | $ 185,957 | $ 304,148 | ||||
Balance, end of period | $ | $ 886,114 | $ 387,644 | $ 743,167 | $ 1,087,226 | |||
Restricted Stock [Member] | Minimum [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting period | 6 months | ||||||
Restricted Stock [Member] | Maximum [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting period | 4 years | ||||||
Stock Compensation Plan [Member] | Chief Executive officer [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Stock grants (in shares) | 217,986 | ||||||
Performance Award [Member] | |||||||
Restricted shares and warrants, additional disclosures [Abstract] | |||||||
First stock price target of common stock (in dollars per share) | $ / shares | $ 7.57 | ||||||
Second stock price target of common stock (in dollars per share) | $ / shares | 10.32 | ||||||
Third stock price target of common stock (in dollars per share) | $ / shares | $ 13.76 | ||||||
Number of consecutive trading days | 45 days | ||||||
Award requisite service period | 2 years 4 months 24 days | ||||||
Recorded Liability | $ | $ 74,405 | ||||||
Recorded Income | $ | $ 78,000 | ||||||
2015 Plan [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of active plans for share-based compensation grants | Plan | 1 | ||||||
Number of shares reserved for share-based grants (in shares) | 2,500,000 | ||||||
Shares remain available for grant (in shares) | 1,276,186 | ||||||
Stock options, number of shares [Roll Forward] | |||||||
Outstanding, end of period (in shares) | 2,573,640 | ||||||
2015 Plan [Member] | Stock Options [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting period | 3 years | ||||||
2015 Plan [Member] | Stock Options [Member] | Minimum [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Term of share-based payment award | 5 years | ||||||
2015 Plan [Member] | Stock Options [Member] | Maximum [Member] | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Term of share-based payment award | 7 years |
Line of Credit (Details)
Line of Credit (Details) - Revolving Credit Facility [Member] - USD ($) | 9 Months Ended | |
Dec. 31, 2015 | Sep. 18, 2015 | |
Line of Credit Facility [Line Items] | ||
Borrowing capacity percentage based on value of eligible accounts receivable | 80.00% | |
Borrowing capacity percentage based on value of eligible inventory | 40.00% | |
Notes principal balance outstanding cap value | $ 2,000,000 | |
Notes principal balance outstanding cap percentage | 50.00% | |
Line of credit facility available borrowing | $ 5,653,000 | |
Variable interest rate per annum | 2.25% | |
Line of credit interest rate | 5.50% | |
Line of credit interest rate increase | 6.00% | |
Line of credit non-usage fee | 0.25% | |
Venture Bank [Member] | ||
Line of Credit Facility [Line Items] | ||
Line of credit facility amount | $ 7,000,000 |
Commitments and Contingencies39
Commitments and Contingencies (Details) | 9 Months Ended | 12 Months Ended | |||
Dec. 31, 2015USD ($) | Dec. 31, 2015GBP (£) | Dec. 31, 2014USD ($) | Mar. 31, 2015USD ($) | Mar. 31, 2014USD ($) | |
Royalties [Abstract] | |||||
Royalty paid per unit sold | £ | £ 10 | ||||
Percentage of royalties paid on the net sales of certain products | 5.00% | 5.00% | |||
Minimum royalties paid periodically | $ 4,500 | ||||
Royalty expense | 48,000 | $ 274,000 | $ 353,000 | ||
Purchase Requirements [Abstract] | |||||
Purchase commitments within next twelve months | 1,512,000 | ||||
Future minimum lease payments in subsequent fiscal years under noncancelable operating leases [Abstract] | |||||
2,016 | 744,000 | ||||
2,017 | 610,000 | ||||
2,018 | 339,000 | ||||
2,019 | 228,000 | ||||
Thereafter | 762,000 | ||||
Total future minimum lease payments | 2,683,000 | ||||
Total operating lease expenses | 580,000 | $ 77,000 | $ 250,000 | $ 294,000 | |
Product Liability [Abstract] | |||||
Product liability insurance coverage | $ 10,000,000 |
Savings and Retirement Plans (D
Savings and Retirement Plans (Details) - USD ($) | 9 Months Ended | 12 Months Ended | ||||
Dec. 31, 2015 | Dec. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2015 | Mar. 31, 2015 | |
Defined Benefit Plan Disclosure [Line Items] | ||||||
Employer discretionary contribution amount to U.S. plan | $ 261,000 | $ 206,000 | $ 282,000 | $ 224,000 | ||
Total contribution expense associated with the plan | $ 33,000 | 19,000 | 24,000 | 22,000 | ||
Cumulative gains losses as percentage of benefit obligations or plan assets | 10.00% | |||||
The Netherlands Defined Benefit Plan [Member] | ||||||
Benefit payments in subsequent fiscal years [Abstract] | ||||||
2,016 | $ 21,000 | |||||
2,017 | 21,000 | |||||
2,018 | 21,000 | |||||
2,019 | 26,000 | |||||
2,020 | 26,000 | |||||
2021 to 2025 | 156,000 | |||||
Total benefit payments | 271,000 | |||||
Contributions by employer in next fiscal year | $ 65,000 | |||||
Changes in benefit obligations [Roll Forward] | ||||||
Projected benefit obligation, beginning of period | 4,465,000 | 3,343,000 | 3,343,000 | |||
Service cost | 109,000 | 133,000 | ||||
Interest cost | 51,000 | 81,000 | 102,000 | 108,000 | ||
Benefits paid | (16,000) | (7,000) | ||||
Plan amendment | 0 | (110,000) | ||||
Actuarial result | (977,000) | 2,006,000 | ||||
Foreign currency translation | 33,000 | (1,002,000) | ||||
Projected benefit obligation, end of period | 3,665,000 | 4,465,000 | 3,343,000 | |||
Changes in plan assets [Roll Forward] | ||||||
Plan assets, beginning of period | 3,593,000 | 2,665,000 | 2,665,000 | |||
Contributions to plan | 73,000 | 167,000 | 147,000 | 216,000 | ||
Management cost | (4,000) | (10,000) | ||||
Actual return on assets | (670,000) | 1,603,000 | ||||
Benefits paid | (16,000) | (7,000) | ||||
Foreign currency translation | 26,000 | (805,000) | ||||
Plan assets, end of period | 3,002,000 | 3,593,000 | 2,665,000 | |||
Amount recognized in other comprehensive loss [Abstract] | ||||||
Unrecognized net prior service benefit | (313,000) | (339,000) | ||||
Unrecognized net losses | 656,000 | 941,000 | ||||
Additional other comprehensive loss (gross of income taxes) | 343,000 | 602,000 | ||||
Projected benefit obligation, accumulated benefit obligations and the fair value plan assets [Abstract] | ||||||
Projected benefit obligation | 4,465,000 | 3,343,000 | 3,343,000 | 3,343,000 | 3,665,000 | $ 4,465,000 |
Accumulated benefit obligation | 3,107,000 | 3,710,000 | ||||
Fair value of plan assets | 3,593,000 | 2,665,000 | 3,593,000 | 2,665,000 | 3,002,000 | 3,593,000 |
Excess of the projected benefit obligation over the fair value of the plan assets | 663,000 | 872,000 | ||||
Components of benefit costs for defined benefit retirement plans [Abstract] | ||||||
Gross service cost, net of employee contribution | 98,000 | 92,000 | 118,000 | 113,000 | ||
Interest cost | 51,000 | 81,000 | 102,000 | 108,000 | ||
Management cost | 6,000 | 8,000 | 11,000 | 11,000 | ||
Expected return on assets | (42,000) | (58,000) | (72,000) | (72,000) | ||
Amortization | 1,000 | (1,000) | (2,000) | 0 | ||
Net periodic retirement cost | $ 114,000 | 122,000 | $ 157,000 | 160,000 | ||
Major assumptions used in the calculations [Abstract] | ||||||
Discount rate | 2.40% | 1.50% | ||||
Expected return on assets | 2.40% | 1.50% | ||||
Expected rate of increase in future compensation [Abstract] | ||||||
Expected rate of increase in future compensation, General | 2.50% | 2.50% | ||||
Fair value of the pension plan assets [Abstract] | ||||||
Fair value of pension plan assets | $ 3,593,000 | 2,665,000 | $ 3,593,000 | 2,665,000 | 3,002,000 | 3,593,000 |
The Netherlands Defined Benefit Plan [Member] | Minimum [Member] | ||||||
Expected rate of increase in future compensation [Abstract] | ||||||
Expected rate of increase in future compensation, Individual | 0.00% | 0.00% | ||||
The Netherlands Defined Benefit Plan [Member] | Maximum [Member] | ||||||
Expected rate of increase in future compensation [Abstract] | ||||||
Expected rate of increase in future compensation, Individual | 3.00% | 3.00% | ||||
The Netherlands Defined Benefit Plan [Member] | Other Contracts [Member] | ||||||
Changes in plan assets [Roll Forward] | ||||||
Plan assets, beginning of period | $ 3,593,000 | |||||
Plan assets, end of period | 3,002,000 | $ 3,593,000 | ||||
Projected benefit obligation, accumulated benefit obligations and the fair value plan assets [Abstract] | ||||||
Fair value of plan assets | $ 3,002,000 | $ 3,593,000 | $ 3,002,000 | $ 3,593,000 | ||
Allocation of pension plan assets [Abstract] | ||||||
Target Allocation | 100.00% | 100.00% | ||||
Actual Allocation | 100.00% | 100.00% | ||||
Fair value of the pension plan assets [Abstract] | ||||||
Fair value of pension plan assets | $ 3,002,000 | $ 3,593,000 | $ 3,002,000 | $ 3,593,000 | ||
Reconciliation of beginning and ending balances for Level 3 assets [Roll Forward] | ||||||
Beginning balance at beginning of period | 3,578,000 | |||||
Loss recognized in earnings | 38,000 | |||||
Actuarial loss | (713,000) | |||||
Purchases | 76,000 | |||||
Sales | (16,000) | |||||
Transfers | 16,000 | |||||
Foreign currency translation | 26,000 | |||||
Ending balance at end of period | 3,005,000 | 3,578,000 | ||||
The Netherlands Defined Benefit Plan [Member] | Other Contracts [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ||||||
Changes in plan assets [Roll Forward] | ||||||
Plan assets, beginning of period | 15,000 | |||||
Plan assets, end of period | (3,000) | 15,000 | ||||
Projected benefit obligation, accumulated benefit obligations and the fair value plan assets [Abstract] | ||||||
Fair value of plan assets | (3,000) | 15,000 | (3,000) | 15,000 | ||
Fair value of the pension plan assets [Abstract] | ||||||
Fair value of pension plan assets | (3,000) | 15,000 | (3,000) | 15,000 | ||
The Netherlands Defined Benefit Plan [Member] | Other Contracts [Member] | Significant Observable Inputs (Level 2) [Member] | ||||||
Changes in plan assets [Roll Forward] | ||||||
Plan assets, beginning of period | 0 | |||||
Plan assets, end of period | 0 | 0 | ||||
Projected benefit obligation, accumulated benefit obligations and the fair value plan assets [Abstract] | ||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | ||
Fair value of the pension plan assets [Abstract] | ||||||
Fair value of pension plan assets | 0 | 0 | 0 | 0 | ||
The Netherlands Defined Benefit Plan [Member] | Other Contracts [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||||||
Changes in plan assets [Roll Forward] | ||||||
Plan assets, beginning of period | 3,578,000 | |||||
Plan assets, end of period | 3,005,000 | 3,578,000 | ||||
Projected benefit obligation, accumulated benefit obligations and the fair value plan assets [Abstract] | ||||||
Fair value of plan assets | 3,005,000 | 3,578,000 | 3,005,000 | 3,578,000 | ||
Fair value of the pension plan assets [Abstract] | ||||||
Fair value of pension plan assets | 3,005,000 | 3,578,000 | 3,005,000 | 3,578,000 | ||
The UK Defined Benefit Plan [Member] | ||||||
Benefit payments in subsequent fiscal years [Abstract] | ||||||
2,016 | 83,000 | |||||
2,017 | 28,000 | |||||
2,018 | 160,000 | |||||
2,019 | 53,000 | |||||
2,020 | 0 | |||||
2021 to 2025 | 783,000 | |||||
Total benefit payments | 1,107,000 | |||||
Contributions by employer in next fiscal year | 43,000 | |||||
Changes in benefit obligations [Roll Forward] | ||||||
Projected benefit obligation, beginning of period | 814,000 | 755,000 | 755,000 | |||
Service cost | 4,000 | 5,000 | ||||
Interest cost | 21,000 | 25,000 | 34,000 | 33,000 | ||
Other | (4,000) | (5,000) | ||||
Actuarial result | (91,000) | 119,000 | ||||
Foreign currency translation | 0 | (94,000) | ||||
Projected benefit obligation, end of period | 744,000 | 814,000 | 755,000 | |||
Changes in plan assets [Roll Forward] | ||||||
Plan assets, beginning of period | 730,000 | 756,000 | 756,000 | |||
Contributions to plan | 33,000 | 35,000 | 45,000 | 43,000 | ||
Management cost | (4,000) | (5,000) | ||||
Actual return on assets | 19,000 | 21,000 | ||||
Foreign currency translation | (3,000) | (87,000) | ||||
Plan assets, end of period | 775,000 | 730,000 | 756,000 | |||
Amount recognized in other comprehensive loss [Abstract] | ||||||
Unrecognized net losses | 116,000 | 228,000 | ||||
Projected benefit obligation, accumulated benefit obligations and the fair value plan assets [Abstract] | ||||||
Projected benefit obligation | 814,000 | 755,000 | 814,000 | 755,000 | 744,000 | 814,000 |
Accumulated benefit obligation | 744,000 | 814,000 | ||||
Fair value of plan assets | 730,000 | 756,000 | 756,000 | 756,000 | 775,000 | 730,000 |
Excess of the projected benefit obligation over the fair value of the plan assets | 31,000 | 84,000 | ||||
Components of benefit costs for defined benefit retirement plans [Abstract] | ||||||
Gross service cost, net of employee contribution | 4,000 | 4,000 | 5,000 | 5,000 | ||
Interest cost | 21,000 | 25,000 | 34,000 | 33,000 | ||
Expected return on assets | (15,000) | (21,000) | (28,000) | (21,000) | ||
Amortization | 19,000 | 4,000 | 5,000 | 7,000 | ||
Net periodic retirement cost | $ 29,000 | 12,000 | $ 16,000 | 24,000 | ||
Major assumptions used in the calculations [Abstract] | ||||||
Discount rate | 4.00% | 3.40% | ||||
Expected return on assets | 3.00% | 2.60% | ||||
Fair value of the pension plan assets [Abstract] | ||||||
Fair value of pension plan assets | $ 730,000 | $ 756,000 | $ 756,000 | $ 756,000 | 775,000 | 730,000 |
The UK Defined Benefit Plan [Member] | Deposit Administration Contract [Member] | ||||||
Changes in plan assets [Roll Forward] | ||||||
Plan assets, beginning of period | 730,000 | |||||
Plan assets, end of period | 775,000 | 730,000 | ||||
Projected benefit obligation, accumulated benefit obligations and the fair value plan assets [Abstract] | ||||||
Fair value of plan assets | $ 730,000 | $ 730,000 | $ 775,000 | $ 730,000 | ||
Allocation of pension plan assets [Abstract] | ||||||
Target Allocation | 100.00% | 100.00% | ||||
Actual Allocation | 100.00% | 100.00% | ||||
Fair value of the pension plan assets [Abstract] | ||||||
Fair value of pension plan assets | $ 730,000 | $ 730,000 | $ 775,000 | $ 730,000 | ||
The UK Defined Benefit Plan [Member] | Deposit Administration Contract [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ||||||
Changes in plan assets [Roll Forward] | ||||||
Plan assets, beginning of period | 0 | |||||
Plan assets, end of period | 0 | 0 | ||||
Projected benefit obligation, accumulated benefit obligations and the fair value plan assets [Abstract] | ||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | ||
Fair value of the pension plan assets [Abstract] | ||||||
Fair value of pension plan assets | 0 | 0 | 0 | 0 | ||
The UK Defined Benefit Plan [Member] | Deposit Administration Contract [Member] | Significant Observable Inputs (Level 2) [Member] | ||||||
Changes in plan assets [Roll Forward] | ||||||
Plan assets, beginning of period | 730,000 | |||||
Plan assets, end of period | 775,000 | 730,000 | ||||
Projected benefit obligation, accumulated benefit obligations and the fair value plan assets [Abstract] | ||||||
Fair value of plan assets | 730,000 | 730,000 | 775,000 | 730,000 | ||
Fair value of the pension plan assets [Abstract] | ||||||
Fair value of pension plan assets | 730,000 | 730,000 | 775,000 | 730,000 | ||
The UK Defined Benefit Plan [Member] | Deposit Administration Contract [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||||||
Changes in plan assets [Roll Forward] | ||||||
Plan assets, beginning of period | 0 | |||||
Plan assets, end of period | 0 | 0 | ||||
Projected benefit obligation, accumulated benefit obligations and the fair value plan assets [Abstract] | ||||||
Fair value of plan assets | 0 | 0 | 0 | 0 | ||
Fair value of the pension plan assets [Abstract] | ||||||
Fair value of pension plan assets | $ 0 | $ 0 | $ 0 | $ 0 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 9 Months Ended | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | |
Current [Abstract] | ||||
Federal and state | $ 14,000 | $ 10,000 | $ 8,000 | $ 13,000 |
Foreign | 35,000 | 24,000 | 55,000 | 45,000 |
Deferred [Abstract] | ||||
Federal and state | 0 | 0 | 0 | 0 |
Foreign | (9,000) | 22,000 | 3,000 | 14,000 |
Total income tax expense | 39,832 | 55,785 | 65,506 | 71,899 |
Income tax expense differs from statutory federal income tax benefit [Abstract] | ||||
Statutory federal income tax benefit | (2,376,000) | (1,809,000) | (2,600,000) | (1,799,000) |
State tax benefit, net of federal taxes | (212,000) | (163,000) | (210,000) | (125,000) |
Foreign tax | (18,000) | (32,000) | (40,000) | (39,000) |
Nondeductible expenses - other | 92,000 | 91,000 | 126,000 | 122,000 |
Nondeductible exp - transaction costs | 55,000 | 148,000 | 462,000 | 0 |
Subpart F income | 20,000 | 26,000 | 33,000 | 35,000 |
Valuation allowance increase | 1,377,000 | 1,946,000 | 2,478,000 | 1,007,000 |
Stock compensation shortfall | 128,000 | 0 | 0 | 0 |
Stock compensation true-up | 83,000 | 132,000 | 132,000 | 267,000 |
NOL expiration and true-up | 320,000 | 0 | (53,000) | 307,000 |
Foreign tax credits | 0 | 0 | 0 | 0 |
Other | 571,000 | (283,000) | (262,000) | 297,000 |
Total income tax expense | 39,832 | $ 55,785 | 65,506 | 71,899 |
Deferred tax assets (liabilities) [Abstract] | ||||
Fixed assets | (50,000) | 400,000 | ||
Intangible assets | (4,378,000) | (5,086,000) | ||
Pension liability | 135,000 | 199,000 | ||
Stock based compensation | 1,661,000 | 1,624,000 | ||
Inventory | 298,000 | 184,000 | ||
Debt discount | (1,929,000) | (1,881,000) | ||
Other reserves and accruals | 437,000 | 564,000 | ||
Deferred rent | 250,000 | 12,000 | ||
Undistributed foreign earnings | (451,000) | (429,000) | ||
Foreign tax credits | 68,000 | 68,000 | ||
Net operating losses | 20,812,000 | 19,885,000 | ||
Deferred tax assets (liabilities), gross | 16,853,000 | 15,540,000 | ||
Less valuation allowance | (16,717,000) | (15,340,000) | ||
Deferred tax assets (liabilities), net | $ 136,000 | 200,000 | ||
Operating Loss Carryforwards [Line Items] | ||||
Percentage change in ownership of an entity | 50.00% | |||
Period of change in ownership of entity | 3 years | |||
Operating loss carryforwards limitation on use before December 2006 | $ 750,000 | |||
Operating loss carryforwards limitation on use after December 2006 and before December 2012 | 2,000,000 | |||
Operating loss carryforwards limitation on use after December 2012 and before March 2015 | 720,000 | |||
Operating loss carryforwards limitation on use after March 2015 for the first five years | 1,500,000 | |||
Operating loss carryforwards limitation thereafter | 430,000 | |||
Net operating loss carryforwards from income tax deductions in excess of previously recorded tax benefit | 1,900,000 | |||
Increase in deferred income tax asset | 1,312,820 | 2,199,966 | 1,010,227 | |
Increase in valuation allowance | 1,377,053 | 2,477,900 | 1,006,587 | |
Interest on income taxes accrued | 0 | 0 | 0 | |
Tax penalties accrued | 0 | $ 0 | $ 0 | |
U.S. [Member] | ||||
Operating Loss Carryforwards [Line Items] | ||||
Net operating loss carryforwards | $ 57,600,000 | |||
U.S. [Member] | Minimum [Member] | ||||
Operating Loss Carryforwards [Line Items] | ||||
Net operating loss carryforwards, expiration dates | Dec. 31, 2018 | |||
U.S. [Member] | Maximum [Member] | ||||
Operating Loss Carryforwards [Line Items] | ||||
Net operating loss carryforwards, expiration dates | Dec. 31, 2036 |
Business Segment Information (D
Business Segment Information (Details) | 9 Months Ended | 12 Months Ended | |||
Dec. 31, 2015USD ($)MarketSegmentCustomer | Dec. 31, 2014USD ($) | Mar. 31, 2015USD ($)Customer | Mar. 31, 2014USD ($)Customer | ||
Business Segment Information [Abstract] | |||||
Number of operating markets | Market | 2 | ||||
Number of operating segments | Segment | 1 | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Revenues | $ 36,622,000 | $ 19,506,000 | $ 26,526,000 | $ 24,577,000 | |
Long-lived assets | $ 2,555,000 | $ 1,813,000 | |||
Number of major customers | Customer | 0 | 0 | 0 | ||
United States [Member] | Reportable Geographical Components [Member] | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Revenues | $ 27,236,000 | 14,512,000 | $ 19,970,000 | $ 18,042,000 | |
Long-lived assets | 2,089,000 | 1,338,000 | |||
United Kingdom [Member] | Reportable Geographical Components [Member] | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Revenues | 3,213,000 | 1,923,000 | 2,506,000 | 2,485,000 | |
Long-lived assets | 3,000 | 3,000 | |||
All Other Foreign Countries [Member] | Reportable Geographical Components [Member] | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Revenues | [1] | 6,173,000 | $ 3,071,000 | 4,050,000 | $ 4,050,000 |
The Netherlands [Member] | Reportable Geographical Components [Member] | |||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||
Long-lived assets | $ 463,000 | $ 472,000 | |||
[1] | No other foreign country accounts for 10% or more of the consolidated net sales |
Schedule I - Valuation and Qu43
Schedule I - Valuation and Qualifying Accounts (Details) - USD ($) | 9 Months Ended | 12 Months Ended | |
Dec. 31, 2015 | Mar. 31, 2015 | Mar. 31, 2014 | |
Allowance for Doubtful Accounts [Member] | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance at beginning of fiscal year | $ 18,000 | $ 25,000 | $ 21,000 |
Additions charged to expenses/revenues | 66,000 | 8,000 | 8,000 |
Written off, less recoveries | (57,000) | (13,000) | (5,000) |
Effects of foreign currency fluctuations | 0 | (2,000) | 1,000 |
Balance at end of fiscal year | 27,000 | 18,000 | 25,000 |
Allowance for Sales Returns [Member] | |||
Valuation and Qualifying Accounts Disclosure [Line Items] | |||
Balance at beginning of fiscal year | 15,000 | 20,000 | 53,000 |
Additions charged to expenses/revenues | 26,000 | 4,000 | 43,000 |
Written off, less recoveries | 0 | (9,000) | (76,000) |
Effects of foreign currency fluctuations | 0 | 0 | 0 |
Balance at end of fiscal year | $ 41,000 | $ 15,000 | $ 20,000 |