10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2019

OR

[  ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number 001-33624

SINTX Technologies, Inc.

(previously known as “Amedica Corporation”)

(Exact name of registrant as specified in its charter)

DELAWARE	84-1375299
(State or other jurisdiction	(IRS Employer
of incorporation or organization)	Identification No.)

1885 West 2100 South, Salt Lake City, UT	84119
(Address of principal executive offices)	(Zip Code)

(801) 839-3500

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbols	Name of each exchange on which registered
Common Stock	SINT	The NASDAQ Capital Market

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days: Yes [X] No [  ]

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files); Yes [X] No [  ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act:

Large accelerated filer	[  ]	Accelerated filer	[  ]
Non-accelerated filer	[  ]	Smaller reporting company	[X]
		Emerging growth company	[  ]

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [  ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act): Yes [  ] No [X]

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:

21,793,641 shares of common stock, $0.01 par value, were outstanding at May 13, 2019.

SINTX Technologies, Inc.

(previously known as Amedica Corporation)

Table of Contents

Part I. Financial Information
Item 1. Financial Statements
Condensed Consolidated Balance Sheets (unaudited)	3
Condensed Consolidated Statements of Operations (unaudited)	4
Condensed Consolidated Statements of Stockholders’ Equity (unaudited)	5
Condensed Consolidated Statements of Cash Flows (unaudited)	6
Notes to Condensed Consolidated Financial Statements (unaudited)	7
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	14
Item 3. Quantitative and Qualitative Disclosures About Market Risk	20
Item 4. Controls and Procedures	20
Part II. Other Information
Item 1. Legal Proceedings	21
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	21
Item 3. Defaults Upon Senior Securities	21
Item 4. Mine Safety Disclosures	21
Item 5. Other Information	21
Item 6. Exhibits	22
Signatures	23

2

SINTX Technologies, Inc.

(previously known as Amedica Corporation)

Condensed Consolidated Balance Sheets - Unaudited

(in thousands, except share and per share data)

	March 31, 2019			December 31, 2018
Assets
Current assets:
Cash and cash equivalents	$	4,164		$	5,447
Trade accounts receivable, net of allowance of $92 and $56, respectively		45			263
Prepaid expenses and other current assets		178			171
Inventories, net		69			52
Notes receivable, current portion		1,116			1,084
Total current assets		5,572			7,017
Inventories, net		665			624
Property and equipment, net		97			124
Intangible assets, net		45			46
Long-term note receivable, net of current portion		3,343			3,669
Operating lease right-of-use-asset		500			-
Other long-term assets		35			35
Total assets	$	10,257		$	11,515
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	254		$	301
Accrued liabilities		797			838
Derivative liabilities, current portion		1,088			1,062
Current portion of operating lease liability		715			169
Other current liabilities		18			10
Total current liabilities		2,872			2,380
Derivative liabilities, net of current portion		500			504
Other long-term liabilities		115			232
Total liabilities		3,487			3,116
Commitments and contingencies
Stockholders’ equity:
Convertible preferred stock, $0.01 par value, 130,000,000 shares authorized; 4,074 shares issued and outstanding at March 31, 2019 and December 31, 2018.		-			-
Common stock, $0.01 par value, 250,000,000 shares authorized; 21,793,641 shares issued and outstanding at March 31, 2019 and December 31, 2018.		218			218
Additional paid-in capital		237,462			237,462
Accumulated deficit		(230,910	)		(229,281	)
Total stockholders’ equity		6,770			8,399
Total liabilities and stockholders’ equity	$	10,257		$	11,515

The condensed consolidated balance sheet as of December 31, 2018, has been prepared using information from the audited consolidated balance sheet as of that date.

The accompanying notes are an integral part of these condensed consolidated financial statements.

3

SINTX Technologies, Inc.

(previously known as Amedica Corporation)

Condensed Consolidated Statements of Operations - Unaudited

(in thousands, except share and per share data)

	Three Months Ended March 31,
	2019			2018
Product revenue	$	97		$	-
Costs of revenue		79			-
Gross profit		18			-
Operating expenses:
Research and development		718			877
General and administrative		971			1,307
Sales and marketing		59			47
Total operating expenses		1,748			2,231
Loss from operations		(1,730	)		(2,231	)
Other income (expenses):
Interest income		122			-
Interest expense		-			(476	)
Loss on extinguishment of debt		-			(340	)
Change in fair value of derivative liabilities		(21	)		811
Loss on extinguishment of derivative liabilities		-			(1,252	)
Other income, net		-			2
Total other income (expense), net		101			(1,255	)
Net loss before income taxes		(1,629	)		(3,486	)
Provision for income taxes		-			-
Loss from continuing operations		(1,629	)		(3,486	)
Income from discontinued operations		-			87
Net loss		(1,629	)		(3,399	)
Deemed dividend related to beneficial conversion feature and accretion of discount on convertible Series A preferred stock		-			(9	)
Net loss attributable to common stockholders	$	(1,629	)	$	(3,408	)
Net earnings (loss) per share – basic and diluted
Basic – continuing operations	$	(0.07	)	$	(1.02	)
Basic – discontinued operations		-			0.02
Basic – attributable to common stockholders	$	(0.07	)	$	(1.00	)
Diluted – continuing operations	$	-		$	(1.11	)
Diluted – discontinued operations		-			0.02
Diluted – attributable to common stockholders	$	-		$	(1.09	)
Weighted average common shares outstanding:
Basic		21,793,641			3,411,246
Diluted		21,793,641			3,411,246

The accompanying notes are an integral part of these condensed consolidated financial statements.

4

SINTX Technologies, Inc.

(previously known as Amedica Corporation)

Condensed Consolidated Statements of Stockholders’ Equity - Unaudited

(in thousands, except share and per share data)

	Preferred Stock				Common Stock				Paid-In			Accumulated			Total
	Shares		Amount		Shares		Amount		Capital			Deficit			Equity
Balance at December 31, 2017		-	$	-		3,028,065	$	30	$	226,041		$	(220,629	)	$	5,442
Issuance of common stock from the exercise of warrants		-		-		668,335		7		1,321			-			1,328
Issuance of common stock in exchange for reduction in debt		-		-		580,444		6		1,447			-			1,453
Loss on extinguishment of derivative liability		-		-		-		-		1,040			-			1,040
Warrants issued in association with debt		-		-		-		-		98			-			98
Deemed dividend related to adjustment of the exercise price of warrants issued with debt		-		-		-		-		(9	)		-			(9	)
Accretion of change in warrant exercise price		-		-		-		-		9			-			9
Stock-based compensation		-		-		-		-		24			-			24
Net loss		-		-		-		-		-			(3,399	)		(3,399	)
Balance at March 31, 2018		-	$	-		4,276,844	$	43	$	229,971		$	(224,028	)	$	5,986

	Preferred Stock				Common Stock				Paid-In		Accumulated			Total
	Shares		Amount		Shares		Amount		Capital		Deficit			Equity
Balance at December 31, 2018		4,074	$	-		21,793,641	$	218	$	237,462	$	(229,281	)	$	8,399
Net loss		-		-		-		-		-		(1,629	)		(1,629	)
Balance at March 31, 2019		4,074	$	-		21,793,641	$	218	$	237,462	$	(230,910	)	$	6,770

The accompanying notes are an integral part of these condensed consolidated financial statements.

5

SINTX Technologies, Inc.

(previously known as Amedica Corporation)

Condensed Consolidated Statements of Cash Flows - Unaudited

(in thousands)

	Three Months Ended March 31,
	2019			2018
Cash flow from operating activities
Net loss from continuing operations	$	(1,629	)	$	(3,486	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense		26			26
Non-cash lease expense		159			-
Amortization of intangible assets		1			-
Amortization of lease incentive for tenant improvements		-			15
Non-cash interest income		(122	)		-
Non-cash interest expense		-			348
Loss on extinguishment of debt		-			340
Stock based compensation		-			24
Change in fair value of derivative liabilities		21			(811	)
Loss on extinguishment of derivative liabilities		-			1,252
Bad debt expense		84			-
Changes in operating assets and liabilities:
Trade accounts receivable		134			-
Prepaid expenses and other current assets		(7	)		(190	)
Inventories		(57	)		-
Accounts payable and accrued liabilities		(79	)		186
Net cash used in operating activities – continuing operations		(1,469	)		(2,296	)
Net cash provided by operating activities – discontinued operations		-			214
Net cash used in operating activities		(1,469	)		(2,082	)
Cash flows from investing activities
Proceeds from notes receivable, net of imputed interest		416			-
Purchase of intangible asset		-			(50	)
Net cash provided by (used in) investing activities – continuing operations		416			(50	)
Net cash used in investing activities – discontinued operations		-			(31	)
Net cash provided by (used in) investing activities		416			(81	)
Cash flows from financing activities
Proceeds from issuance of stock in connection with exercise of warrants, net of issuance costs		-			1,328
Payments on operating lease liability		(230	)		-
Proceeds from issuance of debt		-			705
Net cash provided by (used in) by financing activities		(230	)		2,033
Net decrease in cash and cash equivalents		(1,283	)		(130	)
Cash and cash equivalents at beginning of period		5,447			539
Cash and cash equivalents at end of period	$	4,164		$	409
Noncash investing and financing activities
Right-of-use assets and assumption of operating lease liability	$	659		$	-
Debt exchange		-			2,265
Issuance of common stock in exchange for reduction in debt		-			1,453
Warrants issued in association with debt		-			98
Supplemental cash flow information
Cash paid for interest	$	-		$	72

The accompanying notes are an integral part of these condensed consolidated financial statements.

6

SINTX TECHNOLOGIES, INC.

(PREVIOUSLY KNOWN AS AMEDICA CORPORATION)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. Organization and Summary of Significant Accounting Policies

Organization

SINTX Technologies, Inc. (“SINTX” or “the Company”) (previously known as Amedica Corporation) was incorporated in the state of Delaware on December 10, 1996. SINTX is a commercial-stage biomaterial company focused on using its silicon nitride technology platform to develop, manufacture, and commercialize a broad range of medical devices. The Company believes it is the first and only manufacturer to use silicon nitride in medical applications. The Company acquired US Spine, Inc. (“US Spine”), a Delaware spinal products corporation with operations in Florida, on September 20, 2010. The Company’s products are primarily sold in the United States.

As further explained in Note 12, On October 1, 2018, the Company completed the sale of its retail spine business to CTL Medical, a Dallas, Texas-based privately held medical device manufacturer. As a result of the sale, CTL Medical is now the exclusive owner of SINTX’s portfolio of metal and silicon nitride spine products, which are presently sold under the brand names of Taurus, Preference, and Valeo, with access to future silicon nitride spine technologies. Manufacturing, R&D, and all intellectual property related to the core, non-spine, biomaterial technology of silicon nitride remains with the Company. The Company will serve as CTL’s exclusive OEM provider of silicon nitride products.

On October 30, 2018, the Company amended its Certificate of Incorporation with the State of Delaware to change its corporate name to SINTX Technologies, Inc. in order to better reflect its focus on silicon nitride science and technologies and pipeline of silicon nitride-based products in various biomedical applications. The Company also changed its trading symbol on the NASDAQ Capital Market to “SINT”. The Company also changed the name of its wholly owned subsidiary US Spine, Inc. to “ST Sub, Inc.”

The previous name, Amedica, has transferred to CTL Medical, which is now CTL-Amedica. The Company’s new corporate brand reflects both the Company’s core competence in the science and production of silicon nitride ceramics, as well as encouraging prospects for the future, as an OEM supplier of spine implants to CTL-Amedica, and several opportunities outside of spine. As SINTX Technologies Inc., the Company will focus on developing silicon nitride in terms of product design, and future biomaterial formulations, for a variety of OEM customers.

Basis of Presentation

These unaudited condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the United States Securities and Exchange Commission (“SEC”) and include all assets and liabilities of the Company and its wholly owned subsidiary, ST Sub, Inc. All material intercompany transactions and balances have been eliminated in consolidation. SEC rules and regulations allow the omission of certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States, so long as the statements are not misleading. In the opinion of management, these financial statements and accompanying notes contain all adjustments (consisting of normal recurring adjustments) necessary to present fairly the financial position and results of operations for the periods presented herein. These condensed consolidated financial statements should be read in conjunction with the consolidated audited financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018, filed with the SEC on March 8, 2019. The results of operations for the three months ended March 31, 2019 are not necessarily indicative of the results to be expected for the year ending December 31, 2019. The Company’s significant accounting policies are set forth in Note 1 to the consolidated financial statements in its Annual Report on Form 10-K for the year ended December 31, 2018. 

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenue and expenses during the periods then ended. Actual results could differ from those estimates. The most significant estimates relate to inventory, stock-based compensation, long-lived and intangible assets and the liability for preferred stock and common stock warrants.

Liquidity and Capital Resources

The condensed consolidated financial statements have been prepared assuming the Company will continue to operate as a going concern, which contemplates the realization of assets and settlement of liabilities in the normal course of business, and do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from uncertainty related to its ability to continue as a going concern within one year from the date of issuance of these condensed consolidated financial statements.

For the three months ended March 31, 2019 and 2018, the Company incurred net losses from continuing operations of approximately $1.6 million and $3.5 million, respectively, and used cash in continuing operations of approximately $1.7 million and $2.3 million, respectively. The Company had an accumulated deficit of approximately $231 million and $229 million as of March 31, 2019 and December 31, 2018, respectively. To date, the Company’s operations have been principally financed by proceeds received from the issuance of preferred and common stock, convertible debt and bank debt and, to a lesser extent, cash generated from product sales. It is anticipated that the Company will continue to generate operating losses and use cash in operating activities. The Company’s continuation as a going concern is dependent upon its ability to increase sales and/or raise additional funds through the capital markets. Whether and when the Company can attain profitability and positive cash flows from operating activities or obtain additional financing is uncertain.

The Company is actively generating additional scientific and clinical data to have it published in leading industry publications. The unique features of the Company’s silicon nitride material are not well known, and the Company believes that the publication of such data would help sales efforts as the Company approaches new prospects. The Company is also making additional changes to the sales strategy, including a focus on revenue growth by expanding the use of silicon nitride in other areas outside of spinal fusion applications.

7

The Company has common stock that is publicly traded and has been able to successfully raise capital when needed since the date of the Company’s initial public offering. In March 2018, the Company closed on gross proceeds of $1.4 million, before payment of placement agent fees and costs on a warrant reprice and exercise transaction. Additionally, on May 14, 2018, the Company closed on a public offering of units, consisting of convertible preferred stock and warrants, for gross proceeds of $15 million, which excludes underwriting discounts and commissions and offering expenses payable by the Company. The Company is engaged in discussions with investment and banking firms to examine financing alternatives, including options for a public offering of the Company’s preferred or common stock. On October 1, 2018, the Company sold the retail spine business. This sale will provide cash flows totaling $2.5 million over the next eighteen months and $3.5 million for the following eighteen months. The buyer also assumed the Company’s $2.5 million related party note payable.

Although the Company is seeking to obtain additional equity and/or debt financing, such funding is not assured and may not be available to the Company on favorable or acceptable terms and may involve significant restrictive covenants. Any additional equity financing is also not assured and, if available to the Company, will most likely be dilutive to its current stockholders. If the Company is not able to obtain additional debt or equity financing on a timely basis, the impact on the Company will be material and adverse.

These uncertainties create substantial doubt about our ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties.

Significant Accounting Policies

Except as explained below, no material changes were made to the Company’s significant accounting policies as described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018.

Accounting Pronouncements Adopted During the Quarter Ended March 31, 2019

In August 2016, the FASB updated accounting guidance on the following eight specific cash flow classification issues: (1) debt prepayment or debt extinguishment costs; (2) settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing; (3) contingent consideration payments made after a business combination; (4) proceeds from the settlement of insurance claims; (5) proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies; (6) distributions received from equity method investees; (7) beneficial interests in securitization transactions; and (8) separately identifiable cash flows and application of the predominance principle. Under prior U.S. GAAP, there was no specific guidance on the eight cash flow classification issues aforementioned. The Company adopted the new guidance effective January 1, 2019. The guidance in this standard did not have a material impact on the financial statements of the Company upon adoption.

In February 2016, the FASB updated the accounting guidance related to leases as part of a joint project with the International Accounting Standards Board (“IASB”) to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The Company adopted the new guidance effective January 1, 2019 (see Note 13), using the modified retrospective approach. Under the new guidance, the Company was required to record an additional operating lease right-of-use asset totaling approximately $0.659 million and liability totaling approximately $0.946 million (with $0.659 million incremental to adoption of the new guidance) on the date of adoption. The standard did not materially impact the consolidated net loss and had no impact on cash flows.

In May 2014, in addition to several amendments issued during 2016, the FASB updated the accounting guidance related to revenue from contracts with customers, which supersedes nearly all existing revenue recognition guidance under U.S. GAAP. The Company adopted the new guidance effective January 1, 2019. The core principle of the new guidance is that a company should recognize revenue when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled for those goods or services. The standard defines a five-step process to achieve this core principle and, in doing so, more judgment and estimates are often required within the revenue recognition process than were required under prior U.S. GAAP. The Company has one primary customer (see Note 12) and related contract that has one performance obligation to which revenue is allocated. Revenue under this contract is recognized when the product is shipped to the customer. The Company generally bills its customer upon shipment of the product and invoices are generally due within 30 days. The Company does provide certain rights of return, which historically have not been significant. The Company does not anticipate incurring significant incremental costs to obtain contracts with future customers. The guidance in this standard did not have a material impact on the financial statements of the Company upon adoption.

New Accounting Pronouncements Not Yet Adopted

The Company has reviewed all recently issued, but not yet adopted, accounting standards, in order to determine their effects, if any, on its results of operations, financial position or cash flows. Based on that review, the Company believes that no other pronouncements will have a significant effect on its financial statements.

8

2. Basic and Diluted Net Loss per Common Share

Basic net loss per share is calculated by dividing the net loss by the weighted-average number of common shares outstanding for the period, without consideration for common stock equivalents. Diluted net loss per share is calculated by dividing the net loss by the weighted-average number of common share equivalents outstanding for the period that are determined to be dilutive. Common stock equivalents are primarily comprised of preferred stock, warrants for the purchase of common stock and stock options. For the three months ended March 31, 2019, there is no difference in the number of shares and net loss used to calculate basic and diluted shares outstanding because their effect would have been anti-dilutive. The Company had potentially dilutive securities, shares of common stock, totaling approximately 22.2 million and 1.6 million as of March 31, 2019 and 2018, respectively.

Below are basic and diluted loss per share data for the three months ended March 31, 2018, which are in thousands except for share and per share data:

	Basic Calculation			Effect of Dilutive Warrant Securities			Diluted Calculation
Numerator:
Loss from continuing operations	$	(3,486	)	$	(313	)	$	(3,799	)
Income from discontinued operations		87			-			87
Deemed dividend and accretion of a discount		(9	)		-			(9	)
Net loss attributable to common stockholders	$	(3,408	)	$	(313	)	$	(3,721	)
Denominator:
Number of shares used in per common share calculations:		3,411,246			-			3,411,246
Net loss per common share:
Loss from continuing operations	$	(1.02	)	$	-		$	(1.11	)
Earnings from discontinued operations		.02			-			.02
Deemed dividend and accretion of a discount		-			-			-
Net loss attributable to common stockholders	$	(1.00	)	$	-		$	(1.09	)

3. Inventories

Inventories consisted of the following (in thousands):

	March 31, 2019		December 31, 2018
Raw materials	$	665	$	624
Intermediate goods		9		-
WIP		60		47
Finished goods		-		5
	$	734	$	676

As of March 31, 2019, inventories totaling approximately $0.07 million and $0.67 million were classified as current and long-term, respectively. Inventories classified as current represent the carrying value of inventories as of March 31, 2019, that management estimates will be sold by March 31, 2020.

4. Intangible Assets

Intangible assets consisted of the following (in thousands):

	March 31, 2019			December 31, 2018
Trademarks	$	50		$	50
Less: accumulated amortization		(5	)		(4	)
	$	45		$	46

9

5. Fair Value Measurements

Financial Instruments Measured and Recorded at Fair Value on a Recurring Basis

The Company has issued certain warrants to purchase shares of common stock, which are considered derivative liabilities because they have registration rights which could require a cash settlement and are re-measured to fair value at each reporting period in accordance with accounting guidance. Fair value is based on the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value as follows:

Level 1 -	quoted market prices for identical assets or liabilities in active markets.
Level 2 -	observable prices that are based on inputs not quoted on active markets but corroborated by market data.
Level 3 -	unobservable inputs reflecting management’s assumptions, consistent with reasonably available assumptions made by other market participants. These valuations require significant judgment.

The Company classifies assets and liabilities measured at fair value in their entirety based on the lowest level of input that is significant to their fair value measurement. No financial assets were measured on a recurring basis as of March 31, 2019 and December 31, 2018. The following tables set forth the financial liabilities measured at fair value on a recurring basis by level within the fair value hierarchy as of March 31, 2019 and December 31, 2018:

	Fair Value Measurements as of March 31, 2019
Description	Level 1		Level 2		Level 3		Total
Derivative liability
Common stock warrants	$	-	$	-	$	1,588	$	1,588

	Fair Value Measurements as of December 31, 2018
Description	Level 1		Level 2		Level 3		Total
Derivative liability
Common stock warrants	$	-	$	-	$	1,566	$	1,566

The Company did not have any transfers of assets and liabilities between Level 1 and Level 2 of the fair value measurement hierarchy during the three months ended March 31, 2019 and 2018.

		Common Stock Warrants
Balance at December 31, 2017	$	(1,357	)
Change in fair value		811
Other, net		(212	)
Balance at March 31, 2018	$	(758	)
Balance at December 31, 2018	$	(1,566	)
Change in fair value		(21	)
Other, net		(1	)
Balance at March 31, 2019	$	(1,588	)

Common Stock Warrants

The Company has issued certain warrants to purchase shares of common stock, which are considered derivative liabilities because they have registration rights which could require a cash settlement and are re-measured to fair value at each reporting period in accordance with accounting guidance. At March 31, 2019 and December 31, 2018, approximately $0.5 million of the derivative liability was calculated using the Black-Scholes-Merton valuation model. At March 31, 2019 and December 31, 2018, approximately $1.1 million of the derivative liability was calculated using the Monte Carlo Simulation valuation model.

The assumptions used in estimating the common stock warrant liability using the Black-Scholes-Merton valuation model as of March 31, 2019 and December 31, 2018 were as follows:

	March 31, 2019			December 31, 2018
Weighted-average risk-free interest rate		2.23	%		2.51	%
Weighted-average expected life (in years)		4.11			0.9
Expected dividend yield		-	%		-	%
Weighted-average expected volatility		68	%		157	%

The assumptions used in estimating the common stock warrant liability using the Monte Carlo Simulation valuation model at March 31, 2019 and December 31, 2018 were as follows:

	March 31, 2019			December 31, 2018
Weighted-average risk-free interest rate		2.42	%		2.46	%
Weighted-average expected life (in years)		2.66			3.1
Expected dividend yield		-	%		-	%
Weighted average expected volatility		68	%		68	%

In addition, if any time after the second anniversary of the issuance of the warrant, both: (1) the 30-day volume weighted average price of the Company’s stock exceeds $3.00; and (2) the average daily trading volume for such 30-day period exceeds $0.4 million, the Company may call this warrant for $0.01 per share. For those warrants that have a call provision, management believes the Monte Carlo Simulation valuation model provides a better estimate of fair value for the warrants issued during 2018 and 2017 than the Black-Scholes-Merton valuation model.

Other Financial Instruments

The Company’s recorded values of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their fair values based on their short-term nature. The recorded value of notes payable approximates the fair value as the interest rate approximates market interest rates.

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6. Accrued Liabilities

Accrued liabilities consisted of the following (in thousands):

	March 31, 2019		December 31, 2018
Payroll and related expense	$	374	$	388
Resterilization and repackaging costs		344		344
Other		79		106
	$	797	$	838

7. Debt

L2 Capital Debt

On January 31, 2018, the Company signed a promissory note in the aggregate principal amount of up to $0.84 million (the “L2 Note”) for an aggregate purchase price of up to $0.75 million and warrants to purchase up to an aggregate of 68,257 shares of common stock (the “Warrants”) at an exercise price of $3.31 per share. The maturity date was six months from date of funding. The L2 Note’s interest rate was 8% per year and a default interest rate of 18% per year. The L2 Note was able to be converted by the holder of the Note at any time following an event of default. The conversion price of the L2 Note in the event of a default was equal to the product of (i) 0.70 multiplied by (ii) the lowest volume weighted average price, or VWAP, of the Company’s common stock during the 20-day trading period ending in the Holder’s sole discretion on the last complete trading day prior to conversion, or, the conversion date.

On May 14, 2018, the Company closed on an underwritten public offering of units, consisting of convertible preferred stock and warrants, for gross proceeds of $15.0 million. Part of the proceeds from this offering were used to pay off the outstanding debt with L2 Capital. The total payoff was $1.1 million, with $0.7 million in principal and $0.4 million in interest.

Hercules and MEF I, LP/Anson Investments Debt Exchange

On January 3, 2018, the Company entered into an Assignment Agreement (the “Assignment Agreement”) with MEF I, LP and Anson Investments Master Fund (collectively the “Assignees” and each an “Assignee”), Hercules Technology III, L.P. (“HT III”) and Hercules Capital, Inc. (“HC” and, together with HT III, “Hercules”), pursuant to which Hercules assigned to the Assignees all amounts remaining due under the Loan and Security Agreement, dated June 30, 2014, as amended, between the Company and Hercules (the “Loan and Security Agreement”) and (2) the note (the “Hercules Note”) between the Company and Hercules evidencing the amounts due under the Loan and Security Agreement. The total amount assigned by Hercules to the Assignees in the aggregate was $2.3 million and was secured by the same collateral underlying the Loan and Security Agreement. Subsequently, the Company entered into an exchange agreement pursuant to which the Assignees agreed to exchange the Hercules Term Loan obligation acquired by them for two senior secured convertible promissory notes issued by the Company, each in the principal amount of $1.1 million for an aggregate principal amount of $2.2 million, (the “Exchange Notes”). The Exchange Notes were scheduled to mature on February 3, 2019 (the “Maturity Date”). The Exchange Notes had interest at a rate of 15% per annum. Prior to the Maturity Date, principal and interest accrued under the Exchange Notes was payable in cash or, if certain conditions were met, payable in shares of our common stock. All principal accrued under the Exchange Notes was convertible into shares of our common stock (“Conversion Shares”) at the election of the holders at any time at a fixed conversion price of $3.87 per share. Upon the occurrence of an event of default, the Assignees were entitled to convert all or any part of their Exchange Notes at a conversion price (the “Alternate Conversion Price”) equal to 70% of the lowest traded price of our common stock during the ten trading days prior to the conversion date, provided that (i) in no event was the Alternate Conversion Price less than $1.75 per share and (ii) the Assignees were not entitled to receive more than 19.99% of the outstanding Common Stock. So long as these Exchange Notes remained outstanding or the Assignees held any Conversion Shares, the Company was prohibited from entering into any financing transaction pursuant to which the Company sell its securities at a price lower than $1.75 per share. The Exchange Notes were secured by a first priority security interest in substantially all of the Company assets, including intellectual property, and contains covenants restricting payments to certain of our affiliates.

On May 14, 2018, the Company closed on an underwritten public offering of units, consisting of convertible preferred stock and warrants, for gross proceeds of $15.0 million. Part of the proceeds from this offering were used to pay off the outstanding debt with MEF I, L.P and Anson Investments. The total payoff was $1.6 million, with $1.4 million in principal and $0.2 million in interest.

North Stadium Term Loan – Related Party

On July 28, 2017, the Company entered into a $2.5 million term loan (the “North Stadium Loan”) with North Stadium Investments, LLC (“North Stadium”), a company owned and controlled by the Company’s Chief Executive Officer and Chairman of the Board. The North Stadium Loan bore interest at 10% per annum and required the Company to make monthly interest only payments from September 5, 2017 through July 5, 2018. All principal and unpaid interest (if any) under the North Stadium Loan was due and payable on July 28, 2018. The North Stadium Loan was secured by substantially all of the Company’s assets but was junior to security interest in assets encumbered by the Hercules Term Loan (see below). In connection with the North Stadium Loan the Company also issued North Stadium a warrant to purchase up to 55,000 shares of the Company’s common stock at a purchase price of $5.04 per share, subject to a 5-year term. The relative estimated value of the warrants on the date of grant approximated $0.2 million, which was being amortized as interest expense over the life of the term loan.

On October 1, 2018, CTL Medical assumed the North Stadium Term Loan debt as part of the sale of the retail spine business. As of December 31, 2018, the Company has been released by North Stadium from any and all obligations related to this debt.

Hercules Term Loan

On June 30, 2014, the Company entered into a Loan and Security Agreement with Hercules which provided the Company with a $20.0 million term loan. The Hercules Term Loan matured on January 1, 2018. The Hercules Term Loan included a $0.2 million closing fee, which was paid to Hercules on the closing date of the loan. The closing fee was recorded as a debt discount and was being amortized to interest expense over the life of the loan. The Hercules Term Loan also included a non-refundable final payment fee of $1.7 million. The final payment fee was being accrued and recorded to interest expense over the life of the loan.

On January 3, 2018, the Hercules Term Loan and all amounts owing thereunder was assigned to MEF I and Anson Investments. See discussion above for a more detailed description of that transaction.

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8. Equity

Preferred Stock Conversion

From July through December of 2018, Series B Convertible Preferred shareholders of the Company converted 10,926 shares of Series B Convertible Preferred Stock into 17,098,973 shares of common stock.

During both May 2018 and June 2018, Series B Convertible Preferred shareholders of the Company converted 4,072 shares of Series B Convertible Preferred Stock into 3,086,570 shares of common stock.

August 2018 Warrant Exercise

During August 2018, pursuant to the cashless exercise provision contained in their warrant, L2 Capital exercised its warrants and was issued 242,063 shares of common stock. The L2 Capital warrant is no longer outstanding.

July 2018 Warrant Exercise

During May 2018, the Company closed on a public offering, consisting of both convertible preferred stock and warrants. During July 2018, 29,927 of the warrants were exercised and converted into 29,927 shares of common stock.

May 2018 Warrant Exercise (July 2016 Warrants)

During March 2018, the Company repriced 832,000 warrants dated July 8, 2016, from $12 to $2.125 (for further description see Warrant Reprice March 2018 below). During May 2018, an additional 145,834 of the repriced warrants were exercised resulting in gross proceeds to the Company of $0.3 million.

May 2018 Unit Offering

On May 14, 2018, the Company closed on an underwritten public offering of units (“the Units”), consisting of convertible preferred stock and warrants, for gross proceeds of $15.0 million, which excludes underwriting discounts and commissions and offering expenses payable by SINTX. The offering was priced at a public offering price of $1,000 per unit. Each unit consisted of one share of Series B Convertible Preferred Stock, with a stated value of $1,100, and warrants to purchase up to 758 shares of common stock (the “May 2018 Warrants”). The May 2018 Warrants are initially exercisable at an exercise price of $1.60 per share and expire 5 years from the date of issuance. The Series B Preferred Stock is convertible into shares of common stock by dividing the stated value of $1,100 by: (i) for the first 40 trading days following the closing of this offering, $1.4512 (the “Conversion Price”), (ii) after 40 trading days but prior to the 81st trading day, the lesser of  (a) the Conversion Price and (b) 87.5% of the lowest volume weighted average price for our Common Stock as reported at the close of trading on the market reporting trade prices for the Common Stock during the five trading days prior to the 41st trading day, and (iii) after 80 trading days, the lesser of  (a) the Conversion Price and (b) 87.5% of the lowest volume weighted average price for our Common Stock as reported at the close of trading on the market reporting trade prices for the Common Stock during the five trading days prior to the date of the notice of conversion. In the case of (ii)(b) and (iii)(b) above, the share price shall not be less than $0.48 (the “Floor Price”). Each of the Conversion Price and Floor Price is subject to adjustment in certain circumstances.

The Company raised $15.0 million associated with the issuance of the Units, with $6.8 million, net of issuance costs of $0.6 million, allocated to the preferred stock and $6.9 million, net of issuance costs of $0.7 million, allocated to the warrants. In association with the warrants that were recorded as a derivative liability, the Company immediately expensed approximately $0.7 million of issuance costs. The 15,000 preferred shares were initially convertible into 11,369,900 shares of common stock and had an effective conversion rate of $1.45 per share based on the proceeds that were allocated to them. The conversion price was adjusted to $0.6543, effective July 12, 2018, and was adjusted again on September 7, 2018 to $0.48.

Warrant Reprice March 2018

During the three months ended March 31, 2018, the Company entered into a warrant amendment agreement (the “Amendment Agreement”) with certain holders of previously issued Series E Common Stock Purchase Warrants (collectively, “Investors”). In connection with that certain Series E Common Stock Purchase Warrant between the Company and Investors dated July 8, 2016, the Company issued to Investors warrants to purchase up to 832,000 shares of common stock (the “Warrant Shares”) at an exercise price of $12.00 per share, (the “Investors Warrants”). Under the terms of the Amendment Agreement, in consideration of Investors exercising 668,335 of the Investors Warrants (the “Warrant Exercise”), the exercise price per share of the Investors Warrants was reduced to $2.125 per share. 668,335 of the Investors Warrants were exercised resulting in gross proceeds to the Company of $1.4 million before payment of placement agent fees and costs. In addition, and as further consideration, the Company issued to Investors new warrants to purchase up to the number of shares of common stock equal to 100% of the number of Warrant Shares issued pursuant to the Warrant Exercise at an exercise price per share equal to $2.00 per share.

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9. Stock-Based Compensation

A summary of the Company’s outstanding stock option activity for the three months ended March 31, 2019 is as follows:

	Options			Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Life (Years)		Intrinsic Value
As of December 31, 2018		11,301		$	255.10		6.3	$	-
Granted		-			-		-		-
Exercised		-			-		-		-
Forfeited		-			-		-		-
Expired		(11	)		7,423.20		-		-
As of March 31, 2019		11,290		$	248.22		6.1	$	-
Exercisable as of March 31, 2019		11,127		$	251.71		6.6	$	-
Expected to vest as of March 31, 2019		11,290		$	248.22		6.1	$	-

The Company estimates the fair value of each stock option on the grant date using the Black-Scholes-Merton valuation model, which requires several estimates including an estimate of the fair value of the underlying common stock on grant date. The expected volatility was based on an average of the historical volatility of a peer group of similar companies. The expected term was calculated utilizing the simplified method. The risk-free interest rate was based on the U.S. Treasury yield curve in effect at the time of grant for the expected term of the option.

Summary of Stock-Based Compensation Expense

Total stock-based compensation expense included in the condensed consolidated statements of operations is allocated as follows (in thousands):

	Three Months Ended March 31,
	2019		2018
General and administrative	$	-	$	13
Selling and marketing		-		11
	$	-	$	24

There was no significant unrecognized stock-based compensation as of March 31, 2019.

10. Commitments and Contingencies

The Company has executed agreements with certain executive officers of the Company which, upon the occurrence of certain events related to a change in control, call for payments to the executives up to three times their annual salary and accelerated vesting of previously granted stock options.

From time to time, the Company is subject to various claims and legal proceedings covering matters that arise in the ordinary course of its business activities. Management believes any liability that may ultimately result from the resolution of these matters will not have a material adverse effect on the Company’s consolidated financial position, operating results or cash flows.

11. Note Receivable

On October 1, 2018, the Company completed the sale of its spine business to CTL Medical. The sale included a $6 million noninterest bearing note receivable. The 36-month term of the note receivable requires 18 payments of $138,889 followed by 18 payments of $194,444, with maturing of the note receivable on October 1, 2021. The note receivable includes an imputed interest rate of 10%, which totaled $915,725 as of October 31, 2018, and has a 36-month amortization. As of March 31, 2019, the net carrying value of the note receivable was approximately $4.5 million.

12. Discontinued Operations

As explained in Note 1, on October 1, 2018, the Company completed the sale of its retail spine business to CTL Medical The gain on the sale of the retail spine business is estimated to approximate $1.4 million, which was recognized during the quarter ended December 31, 2018.

The Company and CTL Medical entered in an asset purchase agreement whereby CTL Medical agreed to acquire all of the Company’s commercial spine business for total consideration of $8.5 million, which includes a $6.0 million (including interest) note receivable (See Note 7) and CTL Medical’s assumption of the Company’s $2.5 million related party note payable (see Note 11). As a result of the closing, CTL Medical is now the exclusive owner of SINTX’s portfolio of metal and silicon nitride spine products, which are presently sold under the brand names of Taurus, Preference, and Valeo, with access to future silicon nitride spine technologies. The Company has agreed to pay the cost, if any, to re-sterilize and re-package select silicon nitride spinal inventories sold to CTL Medical if the sterilization date expires prior to CTL Medical selling the inventories to a third-party customer. This agreement extends for a total of 24 months, ending on September 30, 2020. The Company estimates the sterilization and repackaging cost to approximate $0.5 million. Manufacturing, R&D, and all intellectual property related to the core, non-spine, biomaterial technology of silicon nitride remains with the Company in Salt Lake City. The Company will serve as CTL’s exclusive OEM provider of silicon nitride products.

Operating results related to discontinued operations consisted of the following:

	Three Months Ended
	March 31, 2018
Product revenue	$	2,291
Costs of revenue		523
Gross profit		1,768
Operating expenses:
Research and development		362
General and administrative		167
Sales and marketing		1,151
Total operating expenses		1,680
Income from discontinued operations	$	87

During the three months ended March 31, 2018, the Company only recorded product revenues and cost of revenues related to the spine business. Because of the sale of the retail spine business to CTL Medical, all product revenues and costs of product revenues for this period has been removed from the condensed consolidated statements of operations.

13. Leases

The Company leases office, warehouse and manufacturing space under a single operating lease, which lease expires during 2019 (see Note 1 under Accounting Pronouncements Adopted During the Quarter Ended March 31, 2019). As of March 31, 2019, the operating lease right-of-use asset totaled approximately $0.500 million and the operating lease liability totaled approximately $0.715 million. Operating lease expense during the three months ended March 31, 2019, totaled approximately $0.159 million. As of March 31, 2019, the weighted-average discount rate for the Company’s operating lease totaled 6.5%.

Leases with an initial term of 12 months or less are not recorded on the balance sheet. Lease expense is recognized on a straight-line basis over the term of the lease. The Company accounts for lease components separately from the non-lease components. The depreciable life of the assets and leasehold improvements are limited by the expected lease term.

The Company is in negotiations with the property owner for a new lease at the Company’s current location in Salt Lake City, Utah.

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following discussion and analysis of our financial condition and results of operations in conjunction with our consolidated financial statements for the year ended December 31, 2018 and the notes thereto, along with Management’s Discussion and Analysis of Financial Condition and Results of Operations, included in our Annual Report on Form 10-K for the year ended December 31, 2018, filed separately with the U.S. Securities and Exchange Commission. This discussion and analysis contains forward-looking statements based upon current beliefs, plans, expectations, intentions and projections that involve risks, uncertainties and assumptions, such as statements regarding our plans, objectives, expectations, intentions and projections. Our actual results and the timing of selected events could differ materially from those anticipated in these forward-looking statements as a result of several factors, including those set forth under the “Risk Factors” section of our Annual Report on Form 10-K for the year ended December 31, 2018, and any updates to those risk factors filed from time to time in our Quarterly Reports on Form 10-Q.

Overview

We are a biomaterials company focused on providing ceramic based biomaterial solutions in a variety of medical and industrial applications. To date, our primary focus has been the research, development and commercialization of medical implant products manufactured with silicon nitride. We believe that silicon nitride has a superb combination of properties that make it ideally suited for long-term human implantation. Other biomaterials are based on bone grafts, metal alloys, and polymers- all of which have well-known practical limitations and disadvantages. In contrast, silicon nitride has a legacy of success in the most demanding and extreme industrial environments. As a human implant material, silicon nitride offers bone ingrowth, resistance to bacterial and viral infection, ease of diagnostic imaging, resistance to corrosion, and superior strength and fracture resistance, among other advantages, all of which claims are validated in our large and growing inventory of peer-reviewed, published literature reports. We believe that our versatile silicon nitride manufacturing expertise positions us favorably to introduce new and innovative devices in the medical and non-medical fields.

We also believe that we are the first and only company to commercialize silicon nitride medical implants. Prior to October 1, 2018, we designed, manufactured and commercialized silicon nitride products for our own behalf in the spine implant market. Over 33,000 of our spinal implants manufactured with silicon nitride have been implanted into patients, with an excellent safety record. On October 1, 2018, we sold our spine implant business to CTL Medical and now manufacture spine implants made with silicon nitride for CTL Medical. Prior to selling our spine implant business to CTL Medical, we had received 510(k) regulatory clearance in the United States, a CE mark in Europe, ANVISA approval in Brazil, and ARTG and Prostheses approvals in Australia for a number of silicon nitride spine implant products designed for spinal fusion surgery. Spine implant products manufactured by us from silicon nitride are currently marketed and sold by CTL Medical under the Valeo® brand to surgeons and hospitals in the United States and to selected markets in Europe and South America. These implants are designed for use in cervical (neck) and thoracolumbar (lower back) spine surgery. We are collaborating with CTL Medical to establish a commercial partner in Australia and also working with other partners to obtain regulatory approval for silicon nitride implants in Japan.

The sale of our spine implant business to CTL Medical enables us to now focus on our core competencies. These are research and development of silicon nitride and the design and manufacture of medical and nonmedical products manufactured from silicon nitride and other ceramic materials for our own account and in collaboration with other medical device manufacturers. We are targeting original equipment manufacturer (“OEM”) – including CTL Medical - and private label partnerships in order to accelerate adoption of silicon nitride in future markets such as coating products with silicon nitride, hip and knee replacements, dental and maxillofacial implants, extremities, trauma, and sports medicine. Existing biomaterials, based on plastics, metals, and bone grafts have well-recognized limitations that we believe are addressed by silicon nitride, and we are uniquely positioned to convert existing, successful implant designs made by other companies into products manufactured with silicon nitride. OEM and private label partnerships allow us to work with a variety of partners, accelerate the adoption of silicon nitride, and realize incremental revenue at improved operating margins, when compared to the cost-intensive direct sales model.

We believe that silicon nitride addresses many of the biomaterial-related limitations in fields such as hip and knee replacements, dental and maxillofacial implants, sports medicine, extremities, and trauma surgery. We further believe that the inherent material properties of silicon nitride, and the ability to formulate the material in a variety of compositions, combined with precise control of the surface properties of the material, opens up a number of commercial opportunities across orthopedic surgery, neurological surgery, maxillofacial surgery, and other medical disciplines.

Components of our Results of Operations

We manage our business within one reportable segment, which is consistent with how our management reviews our business, makes investment and resource allocation decisions and assesses operating performance.

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Product Revenue

We derive our product revenue primarily from the manufacture and sale of spinal fusion products, used in the treatment of spine disorders, to CTL Medical, with whom we have a 10-year exclusive sales agreement in place. We are currently pursuing other sales opportunities for silicon nitride products outside the spinal fusion application. We generally recognize revenue from sales at the time the product is shipped. In general, our customers do not have any rights of return or exchange.

We believe our product revenue will increase as CTL Medical increases sales of silicon nitride spinal fusion products, as we secure other opportunities to manufacture third party products with silicon nitride, and as we continue to introduce new products into the market.

Cost of Revenue

The expenses that are included in cost of revenue include all in-house manufacturing costs for the products we manufacture.

Gross Profit

Our gross profit measures our product revenue relative to our cost of revenue. We expect our gross profit to decrease as we expand the penetration of our silicon nitride technology platform through OEM and private label partnerships, which offer additional avenues for the adoption of silicon nitride. Prior to the sale of our retail spine business, our revenues and gross profits were based on our retail sales. With the focus on OEM and private label partnerships, the margins are lower, thus causing the decrease in gross profit.

Research and Development Expenses

Our research and development costs are expensed as incurred. Research and development costs consist of engineering, product development, clinical trials, test-part manufacturing, testing, developing and validating the manufacturing process, manufacturing, facility and regulatory-related costs. Research and development expenses also include employee compensation, employee and non-employee stock-based compensation, supplies and materials, consultant services, and travel and facilities expenses related to research and development activities.

We expect to incur additional research and development costs as we continue to develop new spinal fusion products, our product candidates for total joint replacements, such as our total hip replacement product candidate, and dental applications which, may increase our total research and development expenses.

General and Administrative Expenses

General and administrative expenses consist primarily of salaries, benefits and other related costs, including stock-based compensation for certain members of our executive team and other personnel employed in finance, legal, compliance, administrative, information technology, customer service, executive and human resource departments. General and administrative expenses also include other expenses not part of the other cost categories mentioned above, including facility expenses and professional fees for accounting and legal services.

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RESULTS OF OPERATIONS

The following is a tabular presentation of our condensed consolidated operating results for the three months ended March 31, 2019 and 2018 (in thousands):

	Three Months Ended March 31,
	2019			2018			$ Change			% Change
Product revenue	$	97		$	-		$	97			100	%
Cost of revenue		79			-			79			100	%
Gross profit		18			-			18			100	%
Gross profit %		19	%		-	%		19	%		19	%
Operating expenses:
Research and development		718			877			(159	)		-18	%
General and administrative		971			1,307			(336	)		-26	%
Sales and marketing		59			47			12			26	%
Total operating expenses		1,748			2,231			(483	)		-22	%
Loss from operations		(1,730	)		(2,231	)		501			-22	%
Other income (expense), net		101			(1,255	)		1,356			-108	%
Net loss before taxes		(1,629	)		(3,486	)		1,857			53	%
Provision for income taxes		-			-			-			-
Loss from continuing operations		(1,629	)		(3,486	)		1,857			53	%
Income from discontinued operations		-			87			(87	)		-100	%
Net loss	$	(1,629	)	$	(3,399	)	$	1,770			52	%

Product Revenue

For the three months ended March 31, 2019, total product revenue was $0.1 million as compared to $0.0 million in the same period 2018, an increase of $0.1 million, or 100%. This increase was due the sale of the retail spine business in October 2018 and the related restatement of revenues for the three months ended March 31, 2018 to $0.0 million as a result of the discontinued operations. 

For the three months ended March 31, 2019, domestic revenue increased by $0.1 million, or 100%. This increase was due the sale of the retail spine business in October 2018 and the related restatement of revenues for the three months ended March 31, 2018 to $0.0 million as a result of the discontinued operations. Also, as a result of the discontinued operations treatment due to the sale of the retail spine business, international revenue was eliminated completely.

Cost of Revenue and Gross Profit

For the three months ended March 31, 2019, our cost of revenue increased $0.08 million, or 100%, as compared to the same period in 2018. Gross profit increased $0.02 million and gross margin percentage increased by 19%, Both increases are due to the discontinued operations treatment and the related sale of the retail spine business in October 2018.

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Research and Development Expenses

For the three months ended March 31, 2019, research and development expenses decreased $0.2 million, or 18%, as compared to the same period in 2018. This decrease was primarily attributable to a decrease in payroll related expenses of $0.2 million.

General and Administrative Expenses

For the three months ended March 31, 2019, general and administrative expenses decreased $0.4 million, or 26%, as compared to the same period in 2018. This decrease was primarily attributable to a decrease in accounting expenses of $0.1 million, legal fees of $0.1 million and other expenses of $0.2 million.

Sales and Marketing Expenses

For the three months ended March 31, 2019, sales and marketing expenses increased less than $0.1 million, or 26%, as compared to the same period in 2018. This increase was primarily attributable to an increase in dues and subscription expense of less than $0.01 million and website expense of less than $0.01 million.

Other Expense, Net

For the three months ended March 31, 2019, other expense decreased $1.4 million, or 108%, as compared to the same period in 2018. This decrease was primarily due to a decrease in the loss on the extinguishment of derivative liabilities of $1.3 million, the decrease in interest expense of $0.5 million, the decrease in the loss on extinguishment of debt in of $0.3 million and the increase in interest income of $0.1 million, all offset by the change in the fair value of the derivative liabilities in the amount of $0.8 million.

Liquidity and Capital Resources

The condensed consolidated financial statements have been prepared assuming we will continue to operate as a going concern, which contemplates the realization of assets and settlement of liabilities in the normal course of business, and does not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from uncertainty related to its ability to continue as a going concern within one year from the date of issuance of these condensed consolidated financial statements.

For the three months ended March 31, 2019 and 2018, we incurred net losses from continuing operations of approximately $1.6 million and $3.5 million, respectively, and used cash in continuing operations of approximately $1.7 million and $2.3 million, respectively. We had an accumulated deficit of $231 million and $229 million at March 31, 2019 and December 31, 2018, respectively. To date, our operations have been principally financed by proceeds received from the issuance of preferred and common stock, convertible debt and bank debt and, to a lesser extent, cash generated from product sales. It is anticipated that we will continue to generate operating losses and use cash in operating activities. Our continuation as a going concern is dependent upon its ability to increase sales, implement cost saving measures, maintain compliance with debt covenants and/or raise additional funds through the capital markets. Whether and when we can attain profitability and positive cash flows from operating activities or obtain additional financing is uncertain.

We are actively generating additional scientific and clinical data to have it published in leading industry publications. The unique features of our silicon nitride material are not well known, and publication of such data could help sales efforts as we approach new prospects. We are also making additional changes to the sales strategy, including a focus on revenue growth by expanding the use of silicon nitride in other areas outside of spinal fusion applications.

We have common stock that is publicly traded and have been able to successfully raise capital when needed since the date of our initial public offering. In March 2018, we closed on gross proceeds of $1.4 million, before payment of placement agent fees and costs on a warrant reprice and exercise transaction. Additionally, on May 14, 2018, we closed on a public offering of units, consisting of convertible preferred stock and warrants, for gross proceeds of $15 million, which excludes underwriting discounts and commissions and offering expenses payable by us. We are engaged in discussions with investment and banking firms to examine financing alternatives, including options for another public offering of our preferred or common stock. On October 1, 2018, we sold the retail spine business. This sale will provide cash flows totaling $2.5 million over the next eighteen months and $3.5 million for the following eighteen months. The buyer also assumed the Company’s $2.5 million related party note payable.

Although we are seeking to obtain additional equity and/or debt financing, such funding is not assured and may not be available to us on favorable or acceptable terms and may involve significant restrictive covenants. Any additional equity financing is also not assured and, if available to us, will most likely be dilutive to our current stockholders. If we are not able to obtain additional debt or equity financing on a timely basis, the impact on us will be material and adverse.

These uncertainties create substantial doubt about our ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties.

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Cash Flows

The following table summarizes, for the periods indicated, cash flows from operating, investing and financing activities (in thousands) – unaudited:

	Three Months Ended March 31,
	2019			2018
Net cash used in operating activities – continuing operations	$	(1,469	)	$	(2,296	)
Net cash provided by operating activities – discontinued operations		-			214
Net cash used in operating activities		(1,469	)		(2,082	)
Net cash provided by (used in) investing activities – continuing operations		416			(50	)
Net cash used in investing activities – discontinued operations		-			(31	)
Net cash provided by (used in) investing activities		416			(81	)
Net cash provided by (used in) financing activities		(230	)		2,033
Net decrease in cash used	$	(1,283	)	$	(130	)

Net Cash Used in Operating Activities

Net cash used in operating activities decreased $0.6 million to $1.5 million during the three months ended March 31, 2019, as compared to $2.1 million for the same period in 2018. The decrease in net cash used in operating activities is due to the decrease in the net loss and related non-cash add backs to the net loss during the three months ended March 31, 2019 as compared to the same period in 2018.

Net Cash Provided by Investing Activities

Net cash provided by investing activities increased $0.5 million to $0.4 million during the three months ended March 31, 2019, compared to net cash used in investing activities of $0.08 million for the same period in 2018. The increase in cash provided by investing activities during 2019 was primarily due to a $0.4 million increase in proceeds from notes receivable. 

Net Cash Used in Financing Activities

Net cash used in financing activities was $0.2 million during the three months ended March 31, 2019, compared to net cash provided by financing activities of $2.0 million during the same period in 2018. The $2.2 million decrease was primarily attributable to the $1.3 million net decrease in proceeds received from the exercise of common stock warrants, a decrease in proceeds from the issuance of debt of $0.7 million and a $0.2 decrease in the operating lease liability due to payments.

Indebtedness

L2 Capital Debt

On January 31, 2018, we signed a promissory note in the aggregate principal amount of up to $0.84 million (the “L2 Note”) for an aggregate purchase price of up to $0.75 million and issued warrants to purchase up to an aggregate of 68,257 shares of common stock (the “Warrants”) at an exercise price of $3.31 per share. The maturity date was six months from date of funding. The L2 Note’s interest rate was 8% per year and a default interest rate of 18% per year. The L2 Note was able to be converted into common shares by the holder of the Note at any time following an event of default. The conversion price of the L2 Note in the event of a default was equal to the product of (i) 0.70 multiplied by (ii) the lowest volume weighted average price, or VWAP, of our common stock during the 20-day trading period ending in the Holder’s sole discretion on the last complete trading day prior to conversion, or, the conversion date.

On May 14, 2018, we closed on an underwritten public offering of units, consisting of convertible preferred stock and warrants, for gross proceeds of $15.0 million. Part of the proceeds from this offering were used to pay off the outstanding debt with L2 Capital. The total payoff was $1.1 million, with $0.7 million in principal and $0.4 million in interest.

Hercules and MEF I, LP/Anson Investments Debt Exchange

On January 3, 2018, we entered into an Assignment Agreement (the “Assignment Agreement”) with MEF I, LP and Anson Investments Master Fund (collectively the “Assignees” and each an “Assignee”), Hercules Technology III, L.P. (“HT III”) and Hercules Capital, Inc. (“HC” and, together with HT III, “Hercules”), pursuant to which Hercules assigned to the Assignees all amounts remaining due under the Loan and Security Agreement, dated June 30, 2014, as amended, between us and Hercules (the “Loan and Security Agreement”) and (2) the note (the “Hercules Note”) between us and Hercules evidencing the amounts due under the Loan and Security Agreement. The total amount assigned by Hercules to the Assignees in the aggregate was $2.3 million and was secured by the same collateral underlying the Loan and Security Agreement. Subsequently, we entered into an exchange agreement pursuant to which the Assignees agreed to exchange the Hercules Term Loan obligation acquired by them for two senior secured convertible promissory notes issued by us, each in the principal amount of $1.1 million for an aggregate principal amount of $2.2 million, (the “Exchange Notes”). The Exchange Notes were scheduled to mature on February 3, 2019 (the “Maturity Date”). The Exchange Notes had interest at a rate of 15% per annum. Prior to the Maturity Date, principal and interest accrued under the Exchange Notes was payable in cash or, if certain conditions were met, payable in shares of our common stock. All principal accrued under the Exchange Notes was convertible into shares of our common stock (“Conversion Shares”) at the election of the holders at any time at a fixed conversion price of $3.87 per share. Upon the occurrence of an event of default, the Assignees were entitled to convert all or any part of their Exchange Notes at a conversion price (the “Alternate Conversion Price”) equal to 70% of the lowest traded price of our common stock during the ten trading days prior to the conversion date, provided that (i) in no event was the Alternate Conversion Price less than $1.75 per share and (ii) the Assignees were not entitled to receive more than 19.99% of the outstanding Common Stock. So long as these Exchange Notes remained outstanding or the Assignees held any Conversion Shares, we were prohibited from entering into any financing transaction pursuant to which we sell our securities at a price lower than $1.75 per share. The Exchange Notes were secured by a first priority security interest in substantially all of our assets, including intellectual property, and contains covenants restricting payments to certain of our affiliates.

On May 14, 2018, we closed on an underwritten public offering of units, consisting of convertible preferred stock and warrants, for gross proceeds of $15.0 million. Part of the proceeds from this offering were used to pay off the outstanding debt with MEF I, L.P and Anson Investments. The total payoff was $1.6 million, with $1.4 million in principal and $0.2 million in interest.

18

North Stadium Term Loan – Related Party

On July 28, 2017, we entered into a $2.5 million term loan (the “North Stadium Loan”) with North Stadium Investments, LLC (“North Stadium”), a company owned and controlled by our Chief Executive Officer and Chairman of the Board. The North Stadium Loan bore interest at 10% per annum and required us to make monthly interest only payments from September 5, 2017 through July 5, 2018. All principal and unpaid interest (if any) under the North Stadium Loan was due and payable on July 28, 2018, which was later extended to October 1, 2018. The North Stadium Loan was secured by substantially all of the assets of the Company and was junior to security interest in assets encumbered by the Hercules Term Loan (see below). In connection with the North Stadium Loan we also issued North Stadium a warrant to purchase up to 55,000 shares of our common stock at a purchase price of $5.04 per share, subject to a 5-year term. The relative estimated value of the warrants on the date of grant approximated $0.2 million, which was being amortized as interest expense over the life of the term loan.

On October 1, 2018, CTL Medical assumed the North Stadium Term Loan debt as part of the sale of the retail spine business. As of December 31, 2018, the Company has been released by North Stadium from any and all obligations related to this debt.

Hercules Term Loan

On June 30, 2014, we entered into a Loan and Security Agreement with Hercules which provided us with a $20.0 million term loan. The Hercules Term Loan matured on January 1, 2018. The Hercules Term Loan included a $0.2 million closing fee, which was paid to Hercules on the closing date of the loan. The closing fee was recorded as a debt discount and was being amortized to interest expense over the life of the loan. The Hercules Term Loan also included a non-refundable final payment fee of $1.7 million. The final payment fee was being accrued and recorded to interest expense over the life of the loan.

On January 3, 2018, the Hercules Term Loan and all amounts owing thereunder was assigned to MEF I and Anson Investments. See discussion above for a more detailed description of that transaction.

19

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements, as defined in Item 303(a)(4) of Regulation S-K.

Critical Accounting Policies and Estimates

A summary of our significant accounting policies and estimates is discussed in Management’s Discussion and Analysis of Financial Condition and Results of Operations and in Note 1 to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2018. Except as referenced in New Accounting Pronouncements below, no material changes to significant accounting policies were made during the three months ended March 31, 2019. The preparation of the financial statements in accordance with U.S. generally accepted accounting principles requires us to make judgments, estimates and assumptions regarding uncertainties that affect the reported amounts of assets and liabilities. Significant areas of uncertainty that require judgments, estimates and assumptions include the accounting for income taxes and other contingencies as well as valuation of derivative liabilities, asset impairment and collectability of accounts receivable. We use historical and other information that we consider to be relevant to make these judgments and estimates. However, actual results may differ from those estimates and assumptions that are used to prepare our financial statements.

New Accounting Pronouncements

See discussion under Note 1, Organization and Summary of Significant Accounting Policies, to the Condensed Consolidated Financial Statements included in Item 1 of Part I of this Quarterly Report on Form 10-Q, for information on new accounting pronouncements.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable.

ITEM 4. CONTROLS AND PROCEDURES

This Report includes the certifications of our Chief Executive Officer and Principal Financial Officer required by Rule 13a-14 of the Securities Exchange Act of 1934 (the “Exchange Act”). See Exhibits 31.1 and 31.2. This Item 4 includes information concerning the controls and control evaluations referred to in those certifications.

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures, as such term is defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934 (the “Exchange Act”), that are designed to ensure that information required to be disclosed in the reports filed or submitted under the Exchange Act, is recorded, processed, summarized, and reported within the time periods specified by the Commission’s rules and forms. Disclosure controls and procedures include controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act are properly recorded, processed, summarized and reported within the time periods required by the Commission’s rules and forms.

We carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer (principal executive officer and principal financial officer), of the effectiveness of the design and operation of these disclosure controls and procedures, as such term is defined in Exchange Act Rule 13a-15(e), as of March 31, 2019. Based on this evaluation, the Chief Executive Officer concluded that our disclosure controls and procedures were not effective as of March 31, 2019, the end of the period covered by this Quarterly Report on Form 10-Q due to the material weaknesses described below.

As defined in SEC Regulation S-X, a material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. Based on this assessment, management determined that, as of December 31, 2018, our internal control over financial reporting was not effective because of the material weaknesses described below.

The design and operating effectiveness of our controls were inadequate to ensure that complex accounting matters are always properly accounted for and reviewed in a timely manner, as outlined below:

20

Control Activities – The Company did not always have adequate control activities that were designed and operating effectively, including timely management review controls and controls to verify the completeness and adequacy of information prior to presentation of the information to the independent auditors.

Monitoring Activities – The Company did not always maintain effective monitoring controls related to the financial reporting process.

Our Chief Executive Officer continues with a review of our controls relating to complex accounting matters. Although our analysis is not complete, we have added additional resources with expertise in accounting for complex accounting matters. We are also considering redesigning controls to add additional layers of review and approval whenever entering into or subsequently converting, exercising, amending, repricing, exiting or otherwise experiencing changes in or to complex financial instruments.

Notwithstanding the identified material weaknesses, the Company believes the consolidated financial statements included in this Annual Report on Form 10-K fairly represent in all material respects our financial condition, results of operations and cash flows at and for the periods presented in accordance with accounting principles generally accepted in the United States of America.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting that occurred during the first quarter of 2019 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II

ITEM 1. LEGAL PROCEEDINGS

We are not aware of any pending or threatened legal proceeding against us that could have a material adverse effect on our business, operating results or financial condition. The medical device industry is characterized by frequent claims and litigation, including claims regarding patent and other intellectual property rights as well as improper hiring practices. As a result, we may be involved in various additional legal proceedings from time to time.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

None.

21

ITEM 6. EXHIBITS

Exhibit Number	Exhibit Description	Filed Herewith	Incorporated by Reference herein from Form or Schedule	Filing Date	SEC File/ Reg. Number
31.1	Certificate of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002	X
31.2	Certificate of the Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	X
32	Certifications of the Chief Executive Officer and Principal Accounting Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002	X
101.INS	XBRL Instance Document	X
101.SCH	XBRL Taxonomy Extension Schema Document	X
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document	X
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document	X
101.LAB	XBRL Taxonomy Extension Label Linkbase Document	X
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document	X

22

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	SINTX Technologies, Inc. (previously known as Amedica Corporation)
Date: May 16, 2019	/s/ B. Sonny Bal
	B. Sonny Bal
	Chief Executive Officer (Principal Executive Officer and Principal Financial Officer)

23

EX-31.1

Exhibit 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

I, B. Sonny Bal, certify that:

1. I have reviewed this quarterly report on Form 10-Q of SINTX Technologies, Inc. (previously known as Amedica Corporation);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 16, 2019	By:	/s/ B. Sonny Bal
		B. Sonny Bal
		Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

I, B. Sonny Bal, certify that:

1. I have reviewed this quarterly report on Form 10-Q of SINTX Technologies, Inc. (previously known as Amedica Corporation);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 16, 2019	By:	/s/ B. Sonny Bal
		B. Sonny Bal
		Chief Executive Officer and Principal Financial Officer

EX-32

Exhibit 32

CERTIFICATIONS UNDER SECTION 906

Pursuant to section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of section 1350, chapter 63 of title 18, United States Code), each of the undersigned officers of SINTX Technologies, Inc. (previously known as Amedica Corporation), a Delaware corporation (the “Company”), does hereby certify, to such officer’s knowledge, that:

The quarterly report for the quarter ended March 31, 2019 (the “Form 10-Q”) of the Company fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, and the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: May 16, 2019	By:	/s/ B. Sonny Bal
		B. Sonny Bal
		Chief Executive Officer
	By:	/s/ B. Sonny Bal
		B. Sonny Bal
		Principal Financial Officer

XML

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2019	May 13, 2019
Document And Entity Information
Entity Registrant Name	Sintx Technologies, Inc.
Entity Central Index Key	0001269026
Document Type	10-Q
Document Period End Date	Mar. 31, 2019
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Entity Small Business Flag	true
Entity Emerging Growth Company	false
Entity Ex Transition Period	false
Entity Common Stock, Shares Outstanding		21,793,641
Trading Symbol	SINT
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2019

XML

Condensed Consolidated Balance Sheets (Unaudited) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Current assets:
Cash and cash equivalents	$ 4,164,000	$ 5,447,000
Trade accounts receivable, net of allowance of $92 and $56, respectively	45,000	263,000
Prepaid expenses and other current assets	178,000	171,000
Inventories, net	69,000	52,000
Notes receivable, current portion	1,116,000	1,084,000
Total current assets	5,572,000	7,017,000
Inventories, net	665,000	624,000
Property and equipment, net	97,000	124,000
Intangible assets, net	45,000	46,000
Long-term note receivable, net of current portion	3,343,000	3,669,000
Operating lease right-of-use-asset	500,000
Other long-term assets	35,000	35,000
Total assets	10,257,000	11,515,000
Current liabilities:
Accounts payable	254,000	301,000
Accrued liabilities	797,000	838,000
Derivative liabilities, current portion	1,088,000	1,062,000
Current portion of operating lease liability	715,000	169,000
Other current liabilities	18,000	10,000
Total current liabilities	2,872,000	2,380,000
Derivative liabilities, net of current portion	500,000	504,000
Other long-term liabilities	115,000	232,000
Total liabilities	3,487,000	3,116,000
Commitments and contingencies
Stockholders' equity:
Convertible preferred stock, $0.01 par value, 130,000,000 shares authorized; 4,074 shares issued and outstanding at March 31, 2019 and December 31, 2018.
Common stock, $0.01 par value, 250,000,000 shares authorized; 21,793,641 shares issued and outstanding at March 31, 2019 and December 31, 2018.	218,000	218,000
Additional paid-in capital	237,462,000	237,462,000
Accumulated deficit	(230,910,000)	(229,281,000)
Total stockholders' equity	6,770,000	8,399,000
Total liabilities and stockholders' equity	$ 10,257,000	$ 11,515,000

XML

Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Statement of Financial Position [Abstract]
Allowance of trade accounts receivable	$ 92	$ 56
Convertible preferred stock, par value	$ 0.01	$ 0.01
Convertible preferred stock, shares authorized	130,000,000	130,000,000
Convertible preferred stock, shares issued	4,074	4,074
Convertible preferred stock, shares outstanding	4,074	4,074
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	250,000,000	250,000,000
Common stock, shares issued	21,793,641	21,793,641
Common stock, shares outstanding	21,793,641	21,793,641

XML

Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Income Statement [Abstract]
Product revenue	$ 97
Costs of revenue	79
Gross profit	18
Operating expenses:
Research and development	718	877
General and administrative	971	1,307
Sales and marketing	59	47
Total operating expenses	1,748	2,231
Loss from operations	(1,730)	(2,231)
Other income (expenses):
Interest income	122
Interest expense		(476)
Loss on extinguishment of debt		(340)
Change in fair value of derivative liabilities	(21)	811
Loss on extinguishment of derivative liabilities		(1,252)
Other income, net		2
Total other income (expense), net	101	(1,255)
Net loss before income taxes	(1,629)	(3,486)
Provision for income taxes
Loss from continuing operations	(1,629)	(3,486)
Income from discontinued operations		87
Net loss	(1,629)	(3,399)
Deemed dividend related to beneficial conversion feature and accretion of discount on convertible Series A preferred stock		(9)
Net loss attributable to common stockholders	$ (1,629)	$ (3,408)
Net earnings (loss) per share - basic and diluted
Basic - continuing operations	$ (0.07)	$ (1.02)
Basic - discontinued operations		0.02
Basic - attributable to common stockholders	(0.07)	(1.00)
Diluted - continuing operations		(1.11)
Diluted - discontinued operations		0.02
Diluted - attributable to common stockholders		$ (1.09)
Weighted average common shares outstanding:
Basic	21,793,641	3,411,246
Diluted	21,793,641	3,411,246

XML

Condensed Consolidated Statements of Stockholders' Equity (Unaudited) - USD ($) $ in Thousands	Preferred Stock [Member]	Common Stock [Member]	Paid-In Capital [Member]	Accumulated Deficit [Member]	Total
Balance at Dec. 31, 2017		$ 30	$ 226,041	$ (220,629)	$ 5,442
Balance, shares at Dec. 31, 2017		3,028,065
Issuance of common stock from the exercise of warrants		$ 7	1,321		1,328
Issuance of common stock from the exercise of warrants, shares		668,335
Issuance of common stock in exchange for reduction in debt		$ 6	1,447		1,453
Issuance of common stock in exchange for reduction in debt, shares		580,444
Loss on extinguishment of derivative liability			1,040		1,040
Warrants issued in association with debt			98		98
Deemed dividend related to adjustment of the exercise price of warrants issued with debt			(9)		(9)
Accretion of change in warrant exercise price			9		9
Stock-based compensation			24		24
Net loss				(3,399)	(3,399)
Balance at Mar. 31, 2018		$ 43	229,971	(224,028)	5,986
Balance, shares at Mar. 31, 2018		4,276,844
Balance at Dec. 31, 2018		$ 218	237,462	(229,281)	8,399
Balance, shares at Dec. 31, 2018	4,074	21,793,641
Issuance of common stock in exchange for reduction in debt
Net loss				(1,629)	(1,629)
Balance at Mar. 31, 2019		$ 218	$ 237,462	$ (230,910)	$ 6,770
Balance, shares at Mar. 31, 2019	4,074	21,793,641

XML

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Cash flow from operating activities
Net loss from continuing operations	$ (1,629)	$ (3,486)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense	26	26
Non-cash lease expense	159
Amortization of intangible assets	1
Amortization of lease incentive for tenant improvements		15
Non-cash interest income	(122)
Non-cash interest expense		348
Loss on extinguishment of debt		340
Stock based compensation		24
Change in fair value of derivative liabilities	21	(811)
Loss on extinguishment of derivative liabilities		1,252
Bad debt expense	84
Changes in operating assets and liabilities:
Trade accounts receivable	134
Prepaid expenses and other current assets	(7)	(190)
Inventories	(57)
Accounts payable and accrued liabilities	(79)	186
Net cash used in operating activities - continuing operations	(1,469)	(2,296)
Net cash provided by operating activities - discontinued operations		214
Net cash used in operating activities	(1,469)	(2,082)
Cash flows from investing activities
Proceeds from notes receivable, net of imputed interest	416
Purchase of intangible asset		(50)
Net cash provided by (used in) investing activities - continuing operations	416	(50)
Net cash used in investing activities - discontinued operations		(31)
Net cash provided by (used in) investing activities	416	(81)
Cash flows from financing activities
Proceeds from issuance of stock in connection with exercise of warrants, net of issuance costs		1,328
Payments on operating lease liability	(230)
Proceeds from issuance of debt		705
Net cash provided by (used in) by financing activities	(230)	2,033
Net decrease in cash and cash equivalents	(1,283)	(130)
Cash and cash equivalents at beginning of period	5,447	539
Cash and cash equivalents at end of period	4,164	409
Noncash investing and financing activities
Right-of-use assets and assumption of operating lease liability	659
Debt exchange		2,265
Issuance of common stock in exchange for reduction in debt		1,453
Warrants issued in association with debt		98
Supplemental cash flow information
Cash paid for interest		$ 72

XML

Organization and Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2019

Accounting Policies [Abstract]

Organization and Summary of Significant Accounting Policies

1. Organization and Summary of Significant Accounting Policies

Organization

SINTX Technologies, Inc. (“SINTX” or “the Company”) (previously known as Amedica Corporation) was incorporated in the state of Delaware on December 10, 1996. SINTX is a commercial-stage biomaterial company focused on using its silicon nitride technology platform to develop, manufacture, and commercialize a broad range of medical devices. The Company believes it is the first and only manufacturer to use silicon nitride in medical applications. The Company acquired US Spine, Inc. (“US Spine”), a Delaware spinal products corporation with operations in Florida, on September 20, 2010. The Company’s products are primarily sold in the United States.

As further explained in Note 12, On October 1, 2018, the Company completed the sale of its retail spine business to CTL Medical, a Dallas, Texas-based privately held medical device manufacturer. As a result of the sale, CTL Medical is now the exclusive owner of SINTX’s portfolio of metal and silicon nitride spine products, which are presently sold under the brand names of Taurus, Preference, and Valeo, with access to future silicon nitride spine technologies. Manufacturing, R&D, and all intellectual property related to the core, non-spine, biomaterial technology of silicon nitride remains with the Company. The Company will serve as CTL’s exclusive OEM provider of silicon nitride products.

On October 30, 2018, the Company amended its Certificate of Incorporation with the State of Delaware to change its corporate name to SINTX Technologies, Inc. in order to better reflect its focus on silicon nitride science and technologies and pipeline of silicon nitride-based products in various biomedical applications. The Company also changed its trading symbol on the NASDAQ Capital Market to “SINT”. The Company also changed the name of its wholly owned subsidiary US Spine, Inc. to “ST Sub, Inc.”

The previous name, Amedica, has transferred to CTL Medical, which is now CTL-Amedica. The Company’s new corporate brand reflects both the Company’s core competence in the science and production of silicon nitride ceramics, as well as encouraging prospects for the future, as an OEM supplier of spine implants to CTL-Amedica, and several opportunities outside of spine. As SINTX Technologies Inc., the Company will focus on developing silicon nitride in terms of product design, and future biomaterial formulations, for a variety of OEM customers.

Basis of Presentation

These unaudited condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the United States Securities and Exchange Commission (“SEC”) and include all assets and liabilities of the Company and its wholly owned subsidiary, ST Sub, Inc. All material intercompany transactions and balances have been eliminated in consolidation. SEC rules and regulations allow the omission of certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States, so long as the statements are not misleading. In the opinion of management, these financial statements and accompanying notes contain all adjustments (consisting of normal recurring adjustments) necessary to present fairly the financial position and results of operations for the periods presented herein. These condensed consolidated financial statements should be read in conjunction with the consolidated audited financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018, filed with the SEC on March 8, 2019. The results of operations for the three months ended March 31, 2019 are not necessarily indicative of the results to be expected for the year ending December 31, 2019. The Company’s significant accounting policies are set forth in Note 1 to the consolidated financial statements in its Annual Report on Form 10-K for the year ended December 31, 2018. 

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenue and expenses during the periods then ended. Actual results could differ from those estimates. The most significant estimates relate to inventory, stock-based compensation, long-lived and intangible assets and the liability for preferred stock and common stock warrants.

Liquidity and Capital Resources

The condensed consolidated financial statements have been prepared assuming the Company will continue to operate as a going concern, which contemplates the realization of assets and settlement of liabilities in the normal course of business, and do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from uncertainty related to its ability to continue as a going concern within one year from the date of issuance of these condensed consolidated financial statements.

For the three months ended March 31, 2019 and 2018, the Company incurred net losses from continuing operations of approximately $1.6 million and $3.5 million, respectively, and used cash in continuing operations of approximately $1.7 million and $2.3 million, respectively. The Company had an accumulated deficit of approximately $231 million and $229 million as of March 31, 2019 and December 31, 2018, respectively. To date, the Company’s operations have been principally financed by proceeds received from the issuance of preferred and common stock, convertible debt and bank debt and, to a lesser extent, cash generated from product sales. It is anticipated that the Company will continue to generate operating losses and use cash in operating activities. The Company’s continuation as a going concern is dependent upon its ability to increase sales and/or raise additional funds through the capital markets. Whether and when the Company can attain profitability and positive cash flows from operating activities or obtain additional financing is uncertain.

The Company is actively generating additional scientific and clinical data to have it published in leading industry publications. The unique features of the Company’s silicon nitride material are not well known, and the Company believes that the publication of such data would help sales efforts as the Company approaches new prospects. The Company is also making additional changes to the sales strategy, including a focus on revenue growth by expanding the use of silicon nitride in other areas outside of spinal fusion applications.

The Company has common stock that is publicly traded and has been able to successfully raise capital when needed since the date of the Company’s initial public offering. In March 2018, the Company closed on gross proceeds of $1.4 million, before payment of placement agent fees and costs on a warrant reprice and exercise transaction. Additionally, on May 14, 2018, the Company closed on a public offering of units, consisting of convertible preferred stock and warrants, for gross proceeds of $15 million, which excludes underwriting discounts and commissions and offering expenses payable by the Company. The Company is engaged in discussions with investment and banking firms to examine financing alternatives, including options for a public offering of the Company’s preferred or common stock. On October 1, 2018, the Company sold the retail spine business. This sale will provide cash flows totaling $2.5 million over the next eighteen months and $3.5 million for the following eighteen months. The buyer also assumed the Company’s $2.5 million related party note payable.

Although the Company is seeking to obtain additional equity and/or debt financing, such funding is not assured and may not be available to the Company on favorable or acceptable terms and may involve significant restrictive covenants. Any additional equity financing is also not assured and, if available to the Company, will most likely be dilutive to its current stockholders. If the Company is not able to obtain additional debt or equity financing on a timely basis, the impact on the Company will be material and adverse.

These uncertainties create substantial doubt about our ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties.

Significant Accounting Policies

Except as explained below, no material changes were made to the Company’s significant accounting policies as described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018.

Accounting Pronouncements Adopted During the Quarter Ended March 31, 2019

In August 2016, the FASB updated accounting guidance on the following eight specific cash flow classification issues: (1) debt prepayment or debt extinguishment costs; (2) settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing; (3) contingent consideration payments made after a business combination; (4) proceeds from the settlement of insurance claims; (5) proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies; (6) distributions received from equity method investees; (7) beneficial interests in securitization transactions; and (8) separately identifiable cash flows and application of the predominance principle. Under prior U.S. GAAP, there was no specific guidance on the eight cash flow classification issues aforementioned. The Company adopted the new guidance effective January 1, 2019. The guidance in this standard did not have a material impact on the financial statements of the Company upon adoption.

In February 2016, the FASB updated the accounting guidance related to leases as part of a joint project with the International Accounting Standards Board (“IASB”) to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The Company adopted the new guidance effective January 1, 2019 (see Note 13), using the modified retrospective approach. Under the new guidance, the Company was required to record an additional operating lease right-of-use asset totaling approximately $0.659 million and liability totaling approximately $0.946 million (with $0.659 million incremental to adoption of the new guidance) on the date of adoption. The standard did not materially impact the consolidated net loss and had no impact on cash flows.

In May 2014, in addition to several amendments issued during 2016, the FASB updated the accounting guidance related to revenue from contracts with customers, which supersedes nearly all existing revenue recognition guidance under U.S. GAAP. The Company adopted the new guidance effective January 1, 2019. The core principle of the new guidance is that a company should recognize revenue when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled for those goods or services. The standard defines a five-step process to achieve this core principle and, in doing so, more judgment and estimates are often required within the revenue recognition process than were required under prior U.S. GAAP. The Company has one primary customer (see Note 12) and related contract that has one performance obligation to which revenue is allocated. Revenue under this contract is recognized when the product is shipped to the customer. The Company generally bills its customer upon shipment of the product and invoices are generally due within 30 days. The Company does provide certain rights of return, which historically have not been significant. The Company does not anticipate incurring significant incremental costs to obtain contracts with future customers. The guidance in this standard did not have a material impact on the financial statements of the Company upon adoption.

New Accounting Pronouncements Not Yet Adopted

The Company has reviewed all recently issued, but not yet adopted, accounting standards, in order to determine their effects, if any, on its results of operations, financial position or cash flows. Based on that review, the Company believes that no other pronouncements will have a significant effect on its financial statements.

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Basic and Diluted Net Loss Per Common Share

3 Months Ended

Mar. 31, 2019

Earnings Per Share [Abstract]

Basic and Diluted Net Loss Per Common Share

2. Basic and Diluted Net Loss per Common Share

Basic net loss per share is calculated by dividing the net loss by the weighted-average number of common shares outstanding for the period, without consideration for common stock equivalents. Diluted net loss per share is calculated by dividing the net loss by the weighted-average number of common share equivalents outstanding for the period that are determined to be dilutive. Common stock equivalents are primarily comprised of preferred stock, warrants for the purchase of common stock and stock options. For the three months ended March 31, 2019, there is no difference in the number of shares and net loss used to calculate basic and diluted shares outstanding because their effect would have been anti-dilutive. The Company had potentially dilutive securities, shares of common stock, totaling approximately 22.2 million and 1.6 million as of March 31, 2019 and 2018, respectively.

Below are basic and diluted loss per share data for the three months ended March 31, 2018, which are in thousands except for share and per share data:

	Basic Calculation			Effect of Dilutive Warrant Securities			Diluted Calculation
Numerator:
Loss from continuing operations	$	(3,486	)	$	(313	)	$	(3,799	)
Income from discontinued operations		87			-			87
Deemed dividend and accretion of a discount		(9	)		-			(9	)
Net loss attributable to common stockholders	$	(3,408	)	$	(313	)	$	(3,721	)
Denominator:
Number of shares used in per common share calculations:		3,411,246			-			3,411,246
Net loss per common share:
Loss from continuing operations	$	(1.02	)	$	-		$	(1.11	)
Earnings from discontinued operations		.02			-			.02
Deemed dividend and accretion of a discount		-			-			-
Net loss attributable to common stockholders	$	(1.00	)	$	-		$	(1.09	)

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Inventories

3 Months Ended

Mar. 31, 2019

Inventory Disclosure [Abstract]

Inventories

3. Inventories

Inventories consisted of the following (in thousands):

	March 31, 2019		December 31, 2018
Raw materials	$	665	$	624
Intermediate goods		9		-
WIP		60		47
Finished goods		-		5
	$	734	$	676

As of March 31, 2019, inventories totaling approximately $0.07 million and $0.67 million were classified as current and long-term, respectively. Inventories classified as current represent the carrying value of inventories as of March 31, 2019, that management estimates will be sold by March 31, 2020.

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Intangible Assets

3 Months Ended

Mar. 31, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets

4. Intangible Assets

Intangible assets consisted of the following (in thousands):

	March 31, 2019			December 31, 2018
Trademarks	$	50		$	50
Less: accumulated amortization		(5	)		(4	)
	$	45		$	46

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Fair Value Measurements

3 Months Ended

Mar. 31, 2019

Fair Value Disclosures [Abstract]

Fair Value Measurements

5. Fair Value Measurements

Financial Instruments Measured and Recorded at Fair Value on a Recurring Basis

The Company has issued certain warrants to purchase shares of common stock, which are considered derivative liabilities because they have registration rights which could require a cash settlement and are re-measured to fair value at each reporting period in accordance with accounting guidance. Fair value is based on the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, under a three-tier fair value hierarchy which prioritizes the inputs used in measuring fair value as follows:

Level 1 -	quoted market prices for identical assets or liabilities in active markets.
Level 2 -	observable prices that are based on inputs not quoted on active markets but corroborated by market data.
Level 3 -	unobservable inputs reflecting management’s assumptions, consistent with reasonably available assumptions made by other market participants. These valuations require significant judgment.

The Company classifies assets and liabilities measured at fair value in their entirety based on the lowest level of input that is significant to their fair value measurement. No financial assets were measured on a recurring basis as of March 31, 2019 and December 31, 2018. The following tables set forth the financial liabilities measured at fair value on a recurring basis by level within the fair value hierarchy as of March 31, 2019 and December 31, 2018:

	Fair Value Measurements as of March 31, 2019
Description	Level 1		Level 2		Level 3		Total
Derivative liability
Common stock warrants	$	-	$	-	$	1,588	$	1,588

	Fair Value Measurements as of December 31, 2018
Description	Level 1		Level 2		Level 3		Total
Derivative liability
Common stock warrants	$	-	$	-	$	1,566	$	1,566

The Company did not have any transfers of assets and liabilities between Level 1 and Level 2 of the fair value measurement hierarchy during the three months ended March 31, 2019 and 2018.

		Common Stock Warrants
Balance at December 31, 2017	$	(1,357	)
Change in fair value		811
Other, net		(212	)
Balance at March 31, 2018	$	(758	)
Balance at December 31, 2018	$	(1,566	)
Change in fair value		(21	)
Other, net		(1	)
Balance at March 31, 2019	$	(1,588	)

Common Stock Warrants

The Company has issued certain warrants to purchase shares of common stock, which are considered derivative liabilities because they have registration rights which could require a cash settlement and are re-measured to fair value at each reporting period in accordance with accounting guidance. At March 31, 2019 and December 31, 2018, approximately $0.5 million of the derivative liability was calculated using the Black-Scholes-Merton valuation model. At March 31, 2019 and December 31, 2018, approximately $1.1 million of the derivative liability was calculated using the Monte Carlo Simulation valuation model.

The assumptions used in estimating the common stock warrant liability using the Black-Scholes-Merton valuation model as of March 31, 2019 and December 31, 2018 were as follows:

	March 31, 2019			December 31, 2018
Weighted-average risk-free interest rate		2.23	%		2.51	%
Weighted-average expected life (in years)		4.11			0.9
Expected dividend yield		-	%		-	%
Weighted-average expected volatility		68	%		157	%

The assumptions used in estimating the common stock warrant liability using the Monte Carlo Simulation valuation model at March 31, 2019 and December 31, 2018 were as follows:

	March 31, 2019			December 31, 2018
Weighted-average risk-free interest rate		2.42	%		2.46	%
Weighted-average expected life (in years)		2.66			3.1
Expected dividend yield		-	%		-	%
Weighted average expected volatility		68	%		68	%

In addition, if any time after the second anniversary of the issuance of the warrant, both: (1) the 30-day volume weighted average price of the Company’s stock exceeds $3.00; and (2) the average daily trading volume for such 30-day period exceeds $0.4 million, the Company may call this warrant for $0.01 per share. For those warrants that have a call provision, management believes the Monte Carlo Simulation valuation model provides a better estimate of fair value for the warrants issued during 2018 and 2017 than the Black-Scholes-Merton valuation model.

Other Financial Instruments

The Company’s recorded values of cash and cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their fair values based on their short-term nature. The recorded value of notes payable approximates the fair value as the interest rate approximates market interest rates.

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Accrued Liabilities

3 Months Ended

Mar. 31, 2019

Payables and Accruals [Abstract]

Accrued Liabilities

6. Accrued Liabilities

Accrued liabilities consisted of the following (in thousands):

	March 31, 2019		December 31, 2018
Payroll and related expense	$	374	$	388
Resterilization and repackaging costs		344		344
Other		79		106
	$	797	$	838

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Debt

3 Months Ended

Mar. 31, 2019

Debt Disclosure [Abstract]

Debt

7. Debt

L2 Capital Debt

On January 31, 2018, the Company signed a promissory note in the aggregate principal amount of up to $0.84 million (the “L2 Note”) for an aggregate purchase price of up to $0.75 million and warrants to purchase up to an aggregate of 68,257 shares of common stock (the “Warrants”) at an exercise price of $3.31 per share. The maturity date was six months from date of funding. The L2 Note’s interest rate was 8% per year and a default interest rate of 18% per year. The L2 Note was able to be converted by the holder of the Note at any time following an event of default. The conversion price of the L2 Note in the event of a default was equal to the product of (i) 0.70 multiplied by (ii) the lowest volume weighted average price, or VWAP, of the Company’s common stock during the 20-day trading period ending in the Holder’s sole discretion on the last complete trading day prior to conversion, or, the conversion date.

On May 14, 2018, the Company closed on an underwritten public offering of units, consisting of convertible preferred stock and warrants, for gross proceeds of $15.0 million. Part of the proceeds from this offering were used to pay off the outstanding debt with L2 Capital. The total payoff was $1.1 million, with $0.7 million in principal and $0.4 million in interest.

Hercules and MEF I, LP/Anson Investments Debt Exchange

On January 3, 2018, the Company entered into an Assignment Agreement (the “Assignment Agreement”) with MEF I, LP and Anson Investments Master Fund (collectively the “Assignees” and each an “Assignee”), Hercules Technology III, L.P. (“HT III”) and Hercules Capital, Inc. (“HC” and, together with HT III, “Hercules”), pursuant to which Hercules assigned to the Assignees all amounts remaining due under the Loan and Security Agreement, dated June 30, 2014, as amended, between the Company and Hercules (the “Loan and Security Agreement”) and (2) the note (the “Hercules Note”) between the Company and Hercules evidencing the amounts due under the Loan and Security Agreement. The total amount assigned by Hercules to the Assignees in the aggregate was $2.3 million and was secured by the same collateral underlying the Loan and Security Agreement. Subsequently, the Company entered into an exchange agreement pursuant to which the Assignees agreed to exchange the Hercules Term Loan obligation acquired by them for two senior secured convertible promissory notes issued by the Company, each in the principal amount of $1.1 million for an aggregate principal amount of $2.2 million, (the “Exchange Notes”). The Exchange Notes were scheduled to mature on February 3, 2019 (the “Maturity Date”). The Exchange Notes had interest at a rate of 15% per annum. Prior to the Maturity Date, principal and interest accrued under the Exchange Notes was payable in cash or, if certain conditions were met, payable in shares of our common stock. All principal accrued under the Exchange Notes was convertible into shares of our common stock (“Conversion Shares”) at the election of the holders at any time at a fixed conversion price of $3.87 per share. Upon the occurrence of an event of default, the Assignees were entitled to convert all or any part of their Exchange Notes at a conversion price (the “Alternate Conversion Price”) equal to 70% of the lowest traded price of our common stock during the ten trading days prior to the conversion date, provided that (i) in no event was the Alternate Conversion Price less than $1.75 per share and (ii) the Assignees were not entitled to receive more than 19.99% of the outstanding Common Stock. So long as these Exchange Notes remained outstanding or the Assignees held any Conversion Shares, the Company was prohibited from entering into any financing transaction pursuant to which the Company sell its securities at a price lower than $1.75 per share. The Exchange Notes were secured by a first priority security interest in substantially all of the Company assets, including intellectual property, and contains covenants restricting payments to certain of our affiliates.

On May 14, 2018, the Company closed on an underwritten public offering of units, consisting of convertible preferred stock and warrants, for gross proceeds of $15.0 million. Part of the proceeds from this offering were used to pay off the outstanding debt with MEF I, L.P and Anson Investments. The total payoff was $1.6 million, with $1.4 million in principal and $0.2 million in interest.

North Stadium Term Loan – Related Party

On July 28, 2017, the Company entered into a $2.5 million term loan (the “North Stadium Loan”) with North Stadium Investments, LLC (“North Stadium”), a company owned and controlled by the Company’s Chief Executive Officer and Chairman of the Board. The North Stadium Loan bore interest at 10% per annum and required the Company to make monthly interest only payments from September 5, 2017 through July 5, 2018. All principal and unpaid interest (if any) under the North Stadium Loan was due and payable on July 28, 2018. The North Stadium Loan was secured by substantially all of the Company’s assets but was junior to security interest in assets encumbered by the Hercules Term Loan (see below). In connection with the North Stadium Loan the Company also issued North Stadium a warrant to purchase up to 55,000 shares of the Company’s common stock at a purchase price of $5.04 per share, subject to a 5-year term. The relative estimated value of the warrants on the date of grant approximated $0.2 million, which was being amortized as interest expense over the life of the term loan.

On October 1, 2018, CTL Medical assumed the North Stadium Term Loan debt as part of the sale of the retail spine business. As of December 31, 2018, the Company has been released by North Stadium from any and all obligations related to this debt.

Hercules Term Loan

On June 30, 2014, the Company entered into a Loan and Security Agreement with Hercules which provided the Company with a $20.0 million term loan. The Hercules Term Loan matured on January 1, 2018. The Hercules Term Loan included a $0.2 million closing fee, which was paid to Hercules on the closing date of the loan. The closing fee was recorded as a debt discount and was being amortized to interest expense over the life of the loan. The Hercules Term Loan also included a non-refundable final payment fee of $1.7 million. The final payment fee was being accrued and recorded to interest expense over the life of the loan.

On January 3, 2018, the Hercules Term Loan and all amounts owing thereunder was assigned to MEF I and Anson Investments. See discussion above for a more detailed description of that transaction.

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Equity

3 Months Ended

Mar. 31, 2019

Equity [Abstract]

Equity

8. Equity

Preferred Stock Conversion

From July through December of 2018, Series B Convertible Preferred shareholders of the Company converted 10,926 shares of Series B Convertible Preferred Stock into 17,098,973 shares of common stock.

During both May 2018 and June 2018, Series B Convertible Preferred shareholders of the Company converted 4,072 shares of Series B Convertible Preferred Stock into 3,086,570 shares of common stock.

August 2018 Warrant Exercise

During August 2018, pursuant to the cashless exercise provision contained in their warrant, L2 Capital exercised its warrants and was issued 242,063 shares of common stock. The L2 Capital warrant is no longer outstanding.

July 2018 Warrant Exercise

During May 2018, the Company closed on a public offering, consisting of both convertible preferred stock and warrants. During July 2018, 29,927 of the warrants were exercised and converted into 29,927 shares of common stock.

May 2018 Warrant Exercise (July 2016 Warrants)

During March 2018, the Company repriced 832,000 warrants dated July 8, 2016, from $12 to $2.125 (for further description see Warrant Reprice March 2018 below). During May 2018, an additional 145,834 of the repriced warrants were exercised resulting in gross proceeds to the Company of $0.3 million.

May 2018 Unit Offering

On May 14, 2018, the Company closed on an underwritten public offering of units (“the Units”), consisting of convertible preferred stock and warrants, for gross proceeds of $15.0 million, which excludes underwriting discounts and commissions and offering expenses payable by SINTX. The offering was priced at a public offering price of $1,000 per unit. Each unit consisted of one share of Series B Convertible Preferred Stock, with a stated value of $1,100, and warrants to purchase up to 758 shares of common stock (the “May 2018 Warrants”). The May 2018 Warrants are initially exercisable at an exercise price of $1.60 per share and expire 5 years from the date of issuance. The Series B Preferred Stock is convertible into shares of common stock by dividing the stated value of $1,100 by: (i) for the first 40 trading days following the closing of this offering, $1.4512 (the “Conversion Price”), (ii) after 40 trading days but prior to the 81st trading day, the lesser of  (a) the Conversion Price and (b) 87.5% of the lowest volume weighted average price for our Common Stock as reported at the close of trading on the market reporting trade prices for the Common Stock during the five trading days prior to the 41st trading day, and (iii) after 80 trading days, the lesser of  (a) the Conversion Price and (b) 87.5% of the lowest volume weighted average price for our Common Stock as reported at the close of trading on the market reporting trade prices for the Common Stock during the five trading days prior to the date of the notice of conversion. In the case of (ii)(b) and (iii)(b) above, the share price shall not be less than $0.48 (the “Floor Price”). Each of the Conversion Price and Floor Price is subject to adjustment in certain circumstances.

The Company raised $15.0 million associated with the issuance of the Units, with $6.8 million, net of issuance costs of $0.6 million, allocated to the preferred stock and $6.9 million, net of issuance costs of $0.7 million, allocated to the warrants. In association with the warrants that were recorded as a derivative liability, the Company immediately expensed approximately $0.7 million of issuance costs. The 15,000 preferred shares were initially convertible into 11,369,900 shares of common stock and had an effective conversion rate of $1.45 per share based on the proceeds that were allocated to them. The conversion price was adjusted to $0.6543, effective July 12, 2018, and was adjusted again on September 7, 2018 to $0.48.

Warrant Reprice March 2018

During the three months ended March 31, 2018, the Company entered into a warrant amendment agreement (the “Amendment Agreement”) with certain holders of previously issued Series E Common Stock Purchase Warrants (collectively, “Investors”). In connection with that certain Series E Common Stock Purchase Warrant between the Company and Investors dated July 8, 2016, the Company issued to Investors warrants to purchase up to 832,000 shares of common stock (the “Warrant Shares”) at an exercise price of $12.00 per share, (the “Investors Warrants”). Under the terms of the Amendment Agreement, in consideration of Investors exercising 668,335 of the Investors Warrants (the “Warrant Exercise”), the exercise price per share of the Investors Warrants was reduced to $2.125 per share. 668,335 of the Investors Warrants were exercised resulting in gross proceeds to the Company of $1.4 million before payment of placement agent fees and costs. In addition, and as further consideration, the Company issued to Investors new warrants to purchase up to the number of shares of common stock equal to 100% of the number of Warrant Shares issued pursuant to the Warrant Exercise at an exercise price per share equal to $2.00 per share.

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Stock-Based Compensation

3 Months Ended

Mar. 31, 2019

Share-based Payment Arrangement [Abstract]

Stock-Based Compensation

9. Stock-Based Compensation

A summary of the Company’s outstanding stock option activity for the three months ended March 31, 2019 is as follows:

	Options			Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Life (Years)		Intrinsic Value
As of December 31, 2018		11,301		$	255.10		6.3	$	-
Granted		-			-		-		-
Exercised		-			-		-		-
Forfeited		-			-		-		-
Expired		(11	)		7,423.20		-		-
As of March 31, 2019		11,290		$	248.22		6.1	$	-
Exercisable as of March 31, 2019		11,127		$	251.71		6.6	$	-
Expected to vest as of March 31, 2019		11,290		$	248.22		6.1	$	-

The Company estimates the fair value of each stock option on the grant date using the Black-Scholes-Merton valuation model, which requires several estimates including an estimate of the fair value of the underlying common stock on grant date. The expected volatility was based on an average of the historical volatility of a peer group of similar companies. The expected term was calculated utilizing the simplified method. The risk-free interest rate was based on the U.S. Treasury yield curve in effect at the time of grant for the expected term of the option.

Summary of Stock-Based Compensation Expense

Total stock-based compensation expense included in the condensed consolidated statements of operations is allocated as follows (in thousands):

	Three Months Ended March 31,
	2019		2018
General and administrative	$	-	$	13
Selling and marketing		-		11
	$	-	$	24

There was no significant unrecognized stock-based compensation as of March 31, 2019.

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Commitments and Contingencies

3 Months Ended

Mar. 31, 2019

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

10. Commitments and Contingencies

The Company has executed agreements with certain executive officers of the Company which, upon the occurrence of certain events related to a change in control, call for payments to the executives up to three times their annual salary and accelerated vesting of previously granted stock options.

From time to time, the Company is subject to various claims and legal proceedings covering matters that arise in the ordinary course of its business activities. Management believes any liability that may ultimately result from the resolution of these matters will not have a material adverse effect on the Company’s consolidated financial position, operating results or cash flows.

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Note Receivable

3 Months Ended

Mar. 31, 2019

Receivables [Abstract]

Note Receivable

11. Note Receivable

On October 1, 2018, the Company completed the sale of its spine business to CTL Medical. The sale included a $6 million noninterest bearing note receivable. The 36-month term of the note receivable requires 18 payments of $138,889 followed by 18 payments of $194,444, with maturing of the note receivable on October 1, 2021. The note receivable includes an imputed interest rate of 10%, which totaled $915,725 as of October 31, 2018, and has a 36-month amortization. As of March 31, 2019, the net carrying value of the note receivable was approximately $4.5 million.

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Discontinued Operations

3 Months Ended

Mar. 31, 2019

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

12. Discontinued Operations

As explained in Note 1, on October 1, 2018, the Company completed the sale of its retail spine business to CTL Medical The gain on the sale of the retail spine business is estimated to approximate $1.4 million, which was recognized during the quarter ended December 31, 2018.

The Company and CTL Medical entered in an asset purchase agreement whereby CTL Medical agreed to acquire all of the Company’s commercial spine business for total consideration of $8.5 million, which includes a $6.0 million (including interest) note receivable (See Note 7) and CTL Medical’s assumption of the Company’s $2.5 million related party note payable (see Note 11). As a result of the closing, CTL Medical is now the exclusive owner of SINTX’s portfolio of metal and silicon nitride spine products, which are presently sold under the brand names of Taurus, Preference, and Valeo, with access to future silicon nitride spine technologies. The Company has agreed to pay the cost, if any, to re-sterilize and re-package select silicon nitride spinal inventories sold to CTL Medical if the sterilization date expires prior to CTL Medical selling the inventories to a third-party customer. This agreement extends for a total of 24 months, ending on September 30, 2020. The Company estimates the sterilization and repackaging cost to approximate $0.5 million. Manufacturing, R&D, and all intellectual property related to the core, non-spine, biomaterial technology of silicon nitride remains with the Company in Salt Lake City. The Company will serve as CTL’s exclusive OEM provider of silicon nitride products.

Operating results related to discontinued operations consisted of the following:

	Three Months Ended
	March 31, 2018
Product revenue	$	2,291
Costs of revenue		523
Gross profit		1,768
Operating expenses:
Research and development		362
General and administrative		167
Sales and marketing		1,151
Total operating expenses		1,680
Income from discontinued operations	$	87

During the three months ended March 31, 2018, the Company only recorded product revenues and cost of revenues related to the spine business. Because of the sale of the retail spine business to CTL Medical, all product revenues and costs of product revenues for this period has been removed from the condensed consolidated statements of operations.

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Leases

3 Months Ended

Mar. 31, 2019

Leases [Abstract]

Leases

13. Leases

The Company leases office, warehouse and manufacturing space under a single operating lease, which lease expires during 2019 (see Note 1 under Accounting Pronouncements Adopted During the Quarter Ended March 31, 2019). As of March 31, 2019, the operating lease right-of-use asset totaled approximately $0.500 million and the operating lease liability totaled approximately $0.715 million. Operating lease expense during the three months ended March 31, 2019, totaled approximately $0.159 million. As of March 31, 2019, the weighted-average discount rate for the Company’s operating lease totaled 6.5%.

Leases with an initial term of 12 months or less are not recorded on the balance sheet. Lease expense is recognized on a straight-line basis over the term of the lease. The Company accounts for lease components separately from the non-lease components. The depreciable life of the assets and leasehold improvements are limited by the expected lease term.

The Company is in negotiations with the property owner for a new lease at the Company’s current location in Salt Lake City, Utah.

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Organization and Summary of Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2019

Accounting Policies [Abstract]

Organization

Organization

SINTX Technologies, Inc. (“SINTX” or “the Company”) (previously known as Amedica Corporation) was incorporated in the state of Delaware on December 10, 1996. SINTX is a commercial-stage biomaterial company focused on using its silicon nitride technology platform to develop, manufacture, and commercialize a broad range of medical devices. The Company believes it is the first and only manufacturer to use silicon nitride in medical applications. The Company acquired US Spine, Inc. (“US Spine”), a Delaware spinal products corporation with operations in Florida, on September 20, 2010. The Company’s products are primarily sold in the United States.

As further explained in Note 12, On October 1, 2018, the Company completed the sale of its retail spine business to CTL Medical, a Dallas, Texas-based privately held medical device manufacturer. As a result of the sale, CTL Medical is now the exclusive owner of SINTX’s portfolio of metal and silicon nitride spine products, which are presently sold under the brand names of Taurus, Preference, and Valeo, with access to future silicon nitride spine technologies. Manufacturing, R&D, and all intellectual property related to the core, non-spine, biomaterial technology of silicon nitride remains with the Company. The Company will serve as CTL’s exclusive OEM provider of silicon nitride products.

On October 30, 2018, the Company amended its Certificate of Incorporation with the State of Delaware to change its corporate name to SINTX Technologies, Inc. in order to better reflect its focus on silicon nitride science and technologies and pipeline of silicon nitride-based products in various biomedical applications. The Company also changed its trading symbol on the NASDAQ Capital Market to “SINT”. The Company also changed the name of its wholly owned subsidiary US Spine, Inc. to “ST Sub, Inc.”

The previous name, Amedica, has transferred to CTL Medical, which is now CTL-Amedica. The Company’s new corporate brand reflects both the Company’s core competence in the science and production of silicon nitride ceramics, as well as encouraging prospects for the future, as an OEM supplier of spine implants to CTL-Amedica, and several opportunities outside of spine. As SINTX Technologies Inc., the Company will focus on developing silicon nitride in terms of product design, and future biomaterial formulations, for a variety of OEM customers.

Basis of Presentation

Basis of Presentation

These unaudited condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the United States Securities and Exchange Commission (“SEC”) and include all assets and liabilities of the Company and its wholly owned subsidiary, ST Sub, Inc. All material intercompany transactions and balances have been eliminated in consolidation. SEC rules and regulations allow the omission of certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States, so long as the statements are not misleading. In the opinion of management, these financial statements and accompanying notes contain all adjustments (consisting of normal recurring adjustments) necessary to present fairly the financial position and results of operations for the periods presented herein. These condensed consolidated financial statements should be read in conjunction with the consolidated audited financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018, filed with the SEC on March 8, 2019. The results of operations for the three months ended March 31, 2019 are not necessarily indicative of the results to be expected for the year ending December 31, 2019. The Company’s significant accounting policies are set forth in Note 1 to the consolidated financial statements in its Annual Report on Form 10-K for the year ended December 31, 2018. 

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States (“U.S. GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenue and expenses during the periods then ended. Actual results could differ from those estimates. The most significant estimates relate to inventory, stock-based compensation, long-lived and intangible assets and the liability for preferred stock and common stock warrants.

Liquidity and Capital Resources

Liquidity and Capital Resources

The condensed consolidated financial statements have been prepared assuming the Company will continue to operate as a going concern, which contemplates the realization of assets and settlement of liabilities in the normal course of business, and do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from uncertainty related to its ability to continue as a going concern within one year from the date of issuance of these condensed consolidated financial statements.

For the three months ended March 31, 2019 and 2018, the Company incurred net losses from continuing operations of approximately $1.6 million and $3.5 million, respectively, and used cash in continuing operations of approximately $1.7 million and $2.3 million, respectively. The Company had an accumulated deficit of approximately $231 million and $229 million as of March 31, 2019 and December 31, 2018, respectively. To date, the Company’s operations have been principally financed by proceeds received from the issuance of preferred and common stock, convertible debt and bank debt and, to a lesser extent, cash generated from product sales. It is anticipated that the Company will continue to generate operating losses and use cash in operating activities. The Company’s continuation as a going concern is dependent upon its ability to increase sales and/or raise additional funds through the capital markets. Whether and when the Company can attain profitability and positive cash flows from operating activities or obtain additional financing is uncertain.

The Company is actively generating additional scientific and clinical data to have it published in leading industry publications. The unique features of the Company’s silicon nitride material are not well known, and the Company believes that the publication of such data would help sales efforts as the Company approaches new prospects. The Company is also making additional changes to the sales strategy, including a focus on revenue growth by expanding the use of silicon nitride in other areas outside of spinal fusion applications.

The Company has common stock that is publicly traded and has been able to successfully raise capital when needed since the date of the Company’s initial public offering. In March 2018, the Company closed on gross proceeds of $1.4 million, before payment of placement agent fees and costs on a warrant reprice and exercise transaction. Additionally, on May 14, 2018, the Company closed on a public offering of units, consisting of convertible preferred stock and warrants, for gross proceeds of $15 million, which excludes underwriting discounts and commissions and offering expenses payable by the Company. The Company is engaged in discussions with investment and banking firms to examine financing alternatives, including options for a public offering of the Company’s preferred or common stock. On October 1, 2018, the Company sold the retail spine business. This sale will provide cash flows totaling $2.5 million over the next eighteen months and $3.5 million for the following eighteen months. The buyer also assumed the Company’s $2.5 million related party note payable.

Although the Company is seeking to obtain additional equity and/or debt financing, such funding is not assured and may not be available to the Company on favorable or acceptable terms and may involve significant restrictive covenants. Any additional equity financing is also not assured and, if available to the Company, will most likely be dilutive to its current stockholders. If the Company is not able to obtain additional debt or equity financing on a timely basis, the impact on the Company will be material and adverse.

These uncertainties create substantial doubt about our ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of these uncertainties.

Significant Accounting Policies

Significant Accounting Policies

Except as explained below, no material changes were made to the Company’s significant accounting policies as described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018.

Accounting Pronouncements Adopted During the Quarter Ended March 31, 2019

Accounting Pronouncements Adopted During the Quarter Ended March 31, 2019

In August 2016, the FASB updated accounting guidance on the following eight specific cash flow classification issues: (1) debt prepayment or debt extinguishment costs; (2) settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing; (3) contingent consideration payments made after a business combination; (4) proceeds from the settlement of insurance claims; (5) proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies; (6) distributions received from equity method investees; (7) beneficial interests in securitization transactions; and (8) separately identifiable cash flows and application of the predominance principle. Under prior U.S. GAAP, there was no specific guidance on the eight cash flow classification issues aforementioned. The Company adopted the new guidance effective January 1, 2019. The guidance in this standard did not have a material impact on the financial statements of the Company upon adoption.

In February 2016, the FASB updated the accounting guidance related to leases as part of a joint project with the International Accounting Standards Board (“IASB”) to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The Company adopted the new guidance effective January 1, 2019 (see Note 13), using the modified retrospective approach. Under the new guidance, the Company was required to record an additional operating lease right-of-use asset totaling approximately $0.659 million and liability totaling approximately $0.946 million (with $0.659 million incremental to adoption of the new guidance) on the date of adoption. The standard did not materially impact the consolidated net loss and had no impact on cash flows.

In May 2014, in addition to several amendments issued during 2016, the FASB updated the accounting guidance related to revenue from contracts with customers, which supersedes nearly all existing revenue recognition guidance under U.S. GAAP. The Company adopted the new guidance effective January 1, 2019. The core principle of the new guidance is that a company should recognize revenue when promised goods or services are transferred to customers in an amount that reflects the consideration to which an entity expects to be entitled for those goods or services. The standard defines a five-step process to achieve this core principle and, in doing so, more judgment and estimates are often required within the revenue recognition process than were required under prior U.S. GAAP. The Company has one primary customer (see Note 12) and related contract that has one performance obligation to which revenue is allocated. Revenue under this contract is recognized when the product is shipped to the customer. The Company generally bills its customer upon shipment of the product and invoices are generally due within 30 days. The Company does provide certain rights of return, which historically have not been significant. The Company does not anticipate incurring significant incremental costs to obtain contracts with future customers. The guidance in this standard did not have a material impact on the financial statements of the Company upon adoption.

New Accounting Pronouncements Not Yet Adopted

New Accounting Pronouncements Not Yet Adopted

The Company has reviewed all recently issued, but not yet adopted, accounting standards, in order to determine their effects, if any, on its results of operations, financial position or cash flows. Based on that review, the Company believes that no other pronouncements will have a significant effect on its financial statements.

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Basic and Diluted Net Loss Per Common Share (Tables)

3 Months Ended

Mar. 31, 2019

Earnings Per Share [Abstract]

Schedule of Basic and Diluted Loss Per Share

Below are basic and diluted loss per share data for the three months ended March 31, 2018, which are in thousands except for share and per share data:

	Basic Calculation			Effect of Dilutive Warrant Securities			Diluted Calculation
Numerator:
Loss from continuing operations	$	(3,486	)	$	(313	)	$	(3,799	)
Income from discontinued operations		87			-			87
Deemed dividend and accretion of a discount		(9	)		-			(9	)
Net loss attributable to common stockholders	$	(3,408	)	$	(313	)	$	(3,721	)
Denominator:
Number of shares used in per common share calculations:		3,411,246			-			3,411,246
Net loss per common share:
Loss from continuing operations	$	(1.02	)	$	-		$	(1.11	)
Earnings from discontinued operations		.02			-			.02
Deemed dividend and accretion of a discount		-			-			-
Net loss attributable to common stockholders	$	(1.00	)	$	-		$	(1.09	)

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Inventories (Tables)

3 Months Ended

Mar. 31, 2019

Inventory Disclosure [Abstract]

Schedule of Components of Inventory

Inventories consisted of the following (in thousands):

	March 31, 2019		December 31, 2018
Raw materials	$	665	$	624
Intermediate goods		9		-
WIP		60		47
Finished goods		-		5
	$	734	$	676

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Intangible Assets (Tables)

3 Months Ended

Mar. 31, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Intangible Assets

Intangible assets consisted of the following (in thousands):

	March 31, 2019			December 31, 2018
Trademarks	$	50		$	50
Less: accumulated amortization		(5	)		(4	)
	$	45		$	46

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Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2019

Schedule of Financial Liabilities Measured at Fair Value on Recurring Basis by Level Within Fair Value Hierarchy

The following tables set forth the financial liabilities measured at fair value on a recurring basis by level within the fair value hierarchy as of March 31, 2019 and December 31, 2018:

	Fair Value Measurements as of March 31, 2019
Description	Level 1		Level 2		Level 3		Total
Derivative liability
Common stock warrants	$	-	$	-	$	1,588	$	1,588

	Fair Value Measurements as of December 31, 2018
Description	Level 1		Level 2		Level 3		Total
Derivative liability
Common stock warrants	$	-	$	-	$	1,566	$	1,566

Schedule of Fair Value Measurement Hierarchy of Derivative Liability

The Company did not have any transfers of assets and liabilities between Level 1 and Level 2 of the fair value measurement hierarchy during the three months ended March 31, 2019 and 2018.

		Common Stock Warrants
Balance at December 31, 2017	$	(1,357	)
Change in fair value		811
Other, net		(212	)
Balance at March 31, 2018	$	(758	)
Balance at December 31, 2018	$	(1,566	)
Change in fair value		(21	)
Other, net		(1	)
Balance at March 31, 2019	$	(1,588	)

Black-Scholes-Merton Valuation Model [Member]

Schedule of Assumptions Used in Estimating Fair Value

The assumptions used in estimating the common stock warrant liability using the Black-Scholes-Merton valuation model as of March 31, 2019 and December 31, 2018 were as follows:

	March 31, 2019			December 31, 2018
Weighted-average risk-free interest rate		2.23	%		2.51	%
Weighted-average expected life (in years)		4.11			0.9
Expected dividend yield		-	%		-	%
Weighted-average expected volatility		68	%		157	%

Monte Carlo Simulation Valuation Model [Member]

Schedule of Assumptions Used in Estimating Fair Value

The assumptions used in estimating the common stock warrant liability using the Monte Carlo Simulation valuation model at March 31, 2019 and December 31, 2018 were as follows:

	March 31, 2019			December 31, 2018
Weighted-average risk-free interest rate		2.42	%		2.46	%
Weighted-average expected life (in years)		2.66			3.1
Expected dividend yield		-	%		-	%
Weighted average expected volatility		68	%		68	%

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Accrued Liabilities (Tables)

3 Months Ended

Mar. 31, 2019

Payables and Accruals [Abstract]

Schedule of Accrued Liabilities

Accrued liabilities consisted of the following (in thousands):

	March 31, 2019		December 31, 2018
Payroll and related expense	$	374	$	388
Resterilization and repackaging costs		344		344
Other		79		106
	$	797	$	838

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Stock-Based Compensation (Tables)

3 Months Ended

Mar. 31, 2019

Share-based Payment Arrangement [Abstract]

Summary of Stock Option Activity

A summary of the Company’s outstanding stock option activity for the three months ended March 31, 2019 is as follows:

	Options			Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Life (Years)		Intrinsic Value
As of December 31, 2018		11,301		$	255.10		6.3	$	-
Granted		-			-		-		-
Exercised		-			-		-		-
Forfeited		-			-		-		-
Expired		(11	)		7,423.20		-		-
As of March 31, 2019		11,290		$	248.22		6.1	$	-
Exercisable as of March 31, 2019		11,127		$	251.71		6.6	$	-
Expected to vest as of March 31, 2019		11,290		$	248.22		6.1	$	-

Summary of Stock-Based Compensation Expense

Total stock-based compensation expense included in the condensed consolidated statements of operations is allocated as follows (in thousands):

	Three Months Ended March 31,
	2019		2018
General and administrative	$	-	$	13
Selling and marketing		-		11
	$	-	$	24

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Discontinued Operations (Tables)

3 Months Ended

Mar. 31, 2019

Discontinued Operations and Disposal Groups [Abstract]

Schedule of Discontinued Operations

Operating results related to discontinued operations consisted of the following:

	Three Months Ended
	March 31, 2018
Product revenue	$	2,291
Costs of revenue		523
Gross profit		1,768
Operating expenses:
Research and development		362
General and administrative		167
Sales and marketing		1,151
Total operating expenses		1,680
Income from discontinued operations	$	87

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Organization and Summary of Significant Accounting Policies (Details Narrative) - USD ($) $ in Thousands				1 Months Ended	3 Months Ended
	Jan. 02, 2019	Oct. 02, 2018	May 14, 2018	Mar. 31, 2018	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Loss from continuing operations					$ (1,629)	$ (3,486)
Net cash used in operating activities					(1,469)	(2,296)
Accumulated deficit					(230,910)		$ (229,281)
Proceeds from issuance of private placement				$ 1,400
Proceeds from issuance of public offering			$ 15,000
Operating lease asset	$ 659				500
Operating lease liability	946				715
Right-of-Use Assets and assumption of operating lease liability	$ 659				$ 659
Retail Spine Business [Member]
Related party note payable assumed amount		$ 2,500
Retail Spine Business [Member] | Next Eighteen Months [Member]
Proceeds from sales of business		2,500
Retail Spine Business [Member] | Following Eighteen Months [Member]
Proceeds from sales of business		$ 3,500

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Basic and Diluted Net Loss Per Common Share (Details Narrative) - shares	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Earnings Per Share [Abstract]
Potentially dilutive securities	22,200,000	1,600,000

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Basic and Diluted Net Loss Per Common Share - Schedule of Basic and Diluted Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Earnings Per Share [Abstract]
Loss from continuing operations, basic calculation		$ (3,486)
Income from discontinued operations		87
Deemed dividend and accretion of a discount, basic calculation		(9)
Net loss attributable to common stockholders, basic calculation	$ (1,629)	(3,408)
Loss from continuing operations, effect of dilutive warrant securities		(313)
Net loss attributable to common stockholders, effect of dilutive warrant securities		(313)
Loss from continuing operations, diluted calculation		(3,799)
Income from discontinued operations, diluted calculation		87
Deemed dividend and accretion of a discount, diluted calculation		(9)
Net loss attributable to common stockholders, diluted calculation		$ (3,721)
Number of shares used in per common share calculations, basic calculation	21,793,641	3,411,246
Number of shares used in per common share calculations, effect of dilutive warrant securities
Number of shares used in per common share calculations, diluted calculation		3,411,246
Loss from continuing operations, basic calculation	$ (0.07)	$ (1.02)
Earnings from discontinued operations, basic calculation		0.02
Deemed dividend and accretion of a discount, basic calculation
Net loss attributable to common stockholders, basic calculation	(0.07)	(1.00)
Loss from continuing operations, diluted calculation		(1.11)
Earnings from discontinued operations, diluted calculation		0.02
Deemed dividend and accretion of a discount, diluted calculation
Net loss attributable to common stockholders, diluted calculation		$ (1.09)

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Inventories (Details Narrative) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Inventory Disclosure [Abstract]
Inventories, current	$ 69	$ 52
Inventories, non - current	$ 670

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Inventories - Schedule of Components of Inventory (Details) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Inventory Disclosure [Abstract]
Raw materials	$ 665	$ 624
Intermediate goods	9
WIP	60	47
Finished goods		5
Inventory	$ 665	$ 624

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Intangible Assets - Schedule of Intangible Assets (Details) - Trademarks [Member] - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Finite-Lived Intangible Assets [Line Items]
Intangible assets, gross	$ 50	$ 50
Less accumulated amortization	(5)	(4)
Intangible assets, net	$ 45	$ 46

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Fair Value Measurements (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Weighted average price stock exceeds	$ 3.00
Average daily trading value	$ 400
Warrants [Member]
Weighted average price stock exceeds	$ 0.01
Black-Scholes-Merton Valuation Model [Member]
Derivative liability	$ 500	$ 500
Monte Carlo Simulation Valuation Model [Member]
Derivative liability	$ 1,100	$ 1,100

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Fair Value Measurements - Schedule of Financial Liabilities Measured at Fair Value on Recurring Basis by Level within Fair Value Hierarchy (Details) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liability	$ 500	$ 504
Fair Value, Measurements, Recurring [Member] | Common Stock Warrants [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liability	1,588	1,566
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | Common Stock Warrants [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liability
Fair Value, Inputs, Level 2 [Member] | Fair Value, Measurements, Recurring [Member] | Common Stock Warrants [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liability
Fair Value, Inputs, Level 3 [Member] | Fair Value, Measurements, Recurring [Member] | Common Stock Warrants [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liability	$ 1,588	$ 1,566

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Fair Value Measurements - Schedule of Fair Value Measurement Hierarchy of Derivative Liability (Details) - Common Stock Warrants [Member] - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Beginning balance	$ (1,566)	$ (1,357)
Change in fair value	(21)	811
Other, net	(1)	(212)
Ending balance	$ (1,588)	$ (758)

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Fair Value Measurements - Schedule of Assumptions Used in Estimating Fair Value (Details) - Common Stock Warrants [Member]	3 Months Ended	12 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
Black-Scholes-Merton Valuation Model [Member] | Weighted-Average Risk-Free Interest Rate [Member]
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Fair value assumptions, measurement input, percentages	2.23%	2.51%
Black-Scholes-Merton Valuation Model [Member] | Weighted-Average Expected Life [Member]
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Fair value assumptions, measurement input, term	4 years 1 month 9 days	10 months 25 days
Black-Scholes-Merton Valuation Model [Member] | Expected Dividend Yield [Member]
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Fair value assumptions, measurement input, percentages	0.00%	0.00%
Black-Scholes-Merton Valuation Model [Member] | Weighted-Average Expected Volatility [Member]
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Fair value assumptions, measurement input, percentages	68.00%	157.00%
Monte Carlo Simulation Valuation Model [Member] | Weighted-Average Risk-Free Interest Rate [Member]
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Fair value assumptions, measurement input, percentages	2.42%	2.46%
Monte Carlo Simulation Valuation Model [Member] | Weighted-Average Expected Life [Member]
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Fair value assumptions, measurement input, term	2 years 7 months 28 days	3 years 1 month 6 days
Monte Carlo Simulation Valuation Model [Member] | Expected Dividend Yield [Member]
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Fair value assumptions, measurement input, percentages	0.00%	0.00%
Monte Carlo Simulation Valuation Model [Member] | Weighted-Average Expected Volatility [Member]
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Fair value assumptions, measurement input, percentages	68.00%	68.00%

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Accrued Liabilities - Schedule of Accrued Liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2019	Dec. 31, 2018
Payables and Accruals [Abstract]
Payroll and related expense	$ 374	$ 388
Resterilization and repackaging costs	344	344
Other	79	106
Total accrued liabilities	$ 797	$ 838

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Debt (Details Narrative) $ / shares in Units, $ in Thousands						1 Months Ended	3 Months Ended
	Oct. 02, 2018	May 14, 2018 USD ($) $ / shares	Jan. 03, 2018 USD ($) $ / shares	Jul. 28, 2017 USD ($) $ / shares shares	Jun. 30, 2014 USD ($)	Jan. 31, 2018 USD ($) Integer $ / shares shares	Mar. 31, 2019	Oct. 31, 2018	Sep. 07, 2018 $ / shares
Percentage of loan bear interest rate								10.00%
Debt instrument, description	The 36-month term of the note receivable requires 18 payments of $138,889 followed by 18 payments of $194,444, with maturing of the note receivable on October 1, 2021.
Debt maturity date							Oct. 01, 2021
Debt instrument conversion price | $ / shares		$ 1.45							$ 0.48
North Stadium Investments, LLC [Member]
Debt principal amount				$ 2,500
Warrant to purchase shares of common stock | shares				55,000
Warrant exercise price per share | $ / shares				$ 5.04
Percentage of loan bear interest rate				10.00%
Debt maturity date				Jul. 28, 2018
Warrant term				5 years
Fair value of warrants				$ 200
Hercules Technology Capital, Inc. [Member] | Loan and Security Agreement [Member]
Debt principal amount					$ 20,000
Debt maturity date					Jan. 01, 2018
L2 Capital Debt [Member]
Debt principal amount		$ 700				$ 840
Debt purchase price						$ 750
Warrant to purchase shares of common stock | shares						68,257
Warrant exercise price per share | $ / shares						$ 3.31
Percentage of loan bear interest rate						8.00%
Percentage of default interest rate						18.00%
Debt trading per share | $ / shares						$ 0.70
Debt instrument trading days | Integer						20
Debt instrument, description						(i) 0.70 multiplied by (ii) the lowest volume weighted average price, or VWAP, of the Company's common stock during the 20-day trading period ending in the Holder's sole discretion on the last complete trading day prior to conversion, or, the conversion date.
Gross proceeds of convertible preferred stock and warrants		15,000
Total payoff amount		1,100
Interest amount		400
Hercules Term Loan [Member]
Debt principal amount			$ 2,300
Hercules Term Loan [Member] | Closing Date [Member]
Term loan fee amount					$ 200
Final payment fee for debt					$ 1,700
Hercules Term Loan [Member] | Senior Secured Convertible Promissory Notes One [Member]
Debt principal amount			1,100
Hercules Term Loan [Member] | Senior Secured Convertible Promissory Notes Two [Member]
Debt principal amount			$ 2,200
Exchange Notes [Member]
Percentage of loan bear interest rate			15.00%
Debt trading per share | $ / shares			$ 1.75
Debt instrument, description			(i) in no event was the Alternate Conversion Price less than $1.75 per share and (ii) the Assignees were not entitled to receive more than 19.99% of the outstanding Common Stock. So long as these Exchange Notes remained outstanding or the Assignees held any Conversion Shares, the Company was prohibited from entering into any financing transaction pursuant to which the Company sell its securities at a price lower than $1.75 per share. The Exchange Notes were secured by a first priority security interest in substantially all of the Company assets, including intellectual property, and contains covenants restricting payments to certain of our affiliates.
Debt maturity date			Feb. 03, 2019
Debt instrument conversion price | $ / shares			$ 3.87
Debt instrument trading percentage			70.00%
MEF I, L.P. and Anson Investments [Member]
Debt principal amount		1,400
Gross proceeds of convertible preferred stock and warrants		15,000
Total payoff amount		1,600
Interest amount		$ 200

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Equity (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands		1 Months Ended			3 Months Ended
	May 14, 2018	Aug. 31, 2018	Jul. 31, 2018	May 31, 2018	Mar. 31, 2018	Mar. 31, 2019	Dec. 31, 2018	Sep. 07, 2018	Jun. 30, 2018
Warrants to purchase of common stock shares				145,834	832,000
Gross proceeds of warrants				$ 300
Proceeds from public offering	$ 15,000
Preferred stock stated value						$ 0.01	$ 0.01
Common stock state value						0.01	0.01
Conversion price per share	$ 1.45							$ 0.48
Share price						3.00
Proceeds from issuance of units	$ 6,800
Preferred stock issuance costs	$ 600
July 12, 2018 [Member]
Conversion price per share						0.6543
Maximum [Member]
Warrants exercise price					$ 12
Minimum [Member]
Warrants exercise price					$ 2.125
Public Offering [Member]
Stock issued price per shares	$ 1,000
Debt conversion, description	(i) for the first 40 trading days following the closing of this offering, $1.4512 (the "Conversion Price"), (ii) after 40 trading days but prior to the 81st trading day, the lesser of (a) the Conversion Price and (b) 87.5% of the lowest volume weighted average price for our Common Stock as reported at the close of trading on the market reporting trade prices for the Common Stock during the five trading days prior to the 41st trading day, and (iii) after 80 trading days, the lesser of (a) the Conversion Price and (b) 87.5% of the lowest volume weighted average price for our Common Stock as reported at the close of trading on the market reporting trade prices for the Common Stock during the five trading days prior to the date of the notice of conversion. In the case of (ii)(b) and (iii)(b) above, the share price shall not be less than $0.48 (the "Floor Price").
Conversion price per share	$ 1.4512
Debt instrument trading percentage	87.50%
Share price	$ 0.48
August 2018 Warrant Exercise [Member] | Secondary Offering [Member]
Warrants converted into shares of common stock		242,063
July 2018 Warrant Exercise [Member] | Public Offering [Member]
Warrants converted into shares of common stock			29,927
Warrant exercise			29,927
Convertible Preferred Stock and Warrants [Member]
Proceeds from public offering	$ 15,000
Warrants [Member]
Warrants to purchase of common stock shares	758
Warrants exercise price	$ 1.60
Warrant term	5 years
Share price						$ 0.01
Number of warrants issued	6,900
Warrants issuance cost	$ 700
Series E Common Stock Purchase Warrant [Member]
Warrant exercise					668,335
Warrants to purchase of common stock shares					832,000
Warrants exercise price					$ 12.00		$ 2.125
Gross proceeds of warrants					$ 1,400
New Warrants [Member]
Warrants exercise price					$ 2.00
Percentage of warrant shares issued for new warrants					100.00%
Series B Convertible Preferred Stock [Member]
Convertible preferred stock shares conversion				4,072					4,072
Preferred stock stated value	$ 1,100
Common stock state value	$ 1,100
Common Stock [Member]
Convertible preferred stock shares conversion	11,369,900			3,086,570					3,086,570
Preferred Stock [Member]
Convertible preferred stock shares conversion	15,000
July Through December of 2018 [Member] | Series B Convertible Preferred Stock [Member]
Convertible preferred stock shares conversion						10,926
July Through December of 2018 [Member] | Common Stock [Member]
Convertible preferred stock shares conversion						17,098,973

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Stock-Based Compensation (Details Narrative)	Mar. 31, 2019 USD ($)
Share-based Payment Arrangement [Abstract]
Unrecognized stock-based compensation

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Stock-Based Compensation - Summary of Stock Option Activity (Details)	3 Months Ended
	Mar. 31, 2019 USD ($) $ / shares shares
Share-based Payment Arrangement [Abstract]
Options, Outstanding at beginning of period | shares	11,301
Options, Granted | shares
Options, Exercised | shares
Options, Forfeited | shares
Options, Expired | shares	(11)
Options, Outstanding at end of period | shares	11,290
Options, Exercisable at end of period | shares	11,127
Options, Expected to vest at end of period | shares	11,290
Weighted Average Exercise Price, Outstanding at beginning of period | $ / shares	$ 255.10
Weighted Average Exercise Price, Granted | $ / shares
Weighted Average Exercise Price, Exercised | $ / shares
Weighted Average Exercise Price, Forfeited | $ / shares
Weighted Average Exercise Price, Expired | $ / shares	7,423.20
Weighted Average Exercise Price, Outstanding at end of period | $ / shares	248.22
Weighted Average Exercise Price, Exercisable at end of period | $ / shares	251.71
Weighted Average Exercise Price, Expected to vest at end of period | $ / shares	$ 248.22
Weighted Average Remaining Contractual Terms (Years), Outstanding at beginning	6 years 3 months 19 days
Weighted Average Remaining Contractual Terms (Years), Outstanding at ending	6 years 1 month 6 days
Weighted Average Remaining Contractual Terms (Years), Exercisable	6 years 7 months 6 days
Weighted Average Remaining Contractual Terms (years), Expected to vest	6 years 1 month 6 days
Intrinsic Value, Outstanding at beginning of period | $
Intrinsic Value, Outstanding at end of period | $
Intrinsic Value, Exercisable at end of period | $
Intrinsic Value, Expected to vest at end of period | $

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Stock-Based Compensation - Summary of Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation expense		$ 24
General and Administrative [Member]
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation expense		13
Selling and Marketing [Member]
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Total stock-based compensation expense		$ 11

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Note Receivable (Details Narrative) - USD ($)		3 Months Ended
	Oct. 02, 2018	Mar. 31, 2019	Dec. 31, 2018	Oct. 31, 2018
Noninterest note receivable	$ 6,000,000	$ 1,116,000	$ 1,084,000
Debt description	The 36-month term of the note receivable requires 18 payments of $138,889 followed by 18 payments of $194,444, with maturing of the note receivable on October 1, 2021.
Payments of notes receivable	$ 138,889	$ 194,444
Maturity date of note receivable		Oct. 01, 2021
Debt instrument imputed interest percentage				10.00%
Imputed interest				$ 915,725
Imputed interest, description		The note receivable includes an imputed interest rate of 10%, which totaled $915,725 as of October 31, 2018, and has a 36-month amortization. As of March 31, 2019, the net carrying value of the note receivable was approximately $4.5 million.
Discontinued Operations, Spine Business [Member]
Noninterest note receivable		$ 4,500,000

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Discontinued Operations (Details Narrative) - USD ($) $ in Thousands		3 Months Ended
	Oct. 02, 2018	Dec. 31, 2018
Asset Purchase Agreement [Member]
Total consideration	$ 8,500
Agreement extention description	This agreement extends for a total of 24 months, ending on September 30, 2020.
Asset Purchase Agreement [Member] | Related Party Note Payable [Member]
Total consideration	$ 2,500
Sterilization and repackaging cost	500
Asset Purchase Agreement [Member] | Interest Note Receivable [Member]
Total consideration	$ 600
Retail Spine Business [Member]
Gain on the sale of business		$ 1,400

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Discontinued Operations - Schedule of Discontinued Operations (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2018 USD ($)
Discontinued Operations and Disposal Groups [Abstract]
Product revenue	$ 2,291
Costs of revenue	523
Gross profit	1,768
Research and development	362
General and administrative	167
Sales and marketing	1,151
Total operating expenses	1,680
Income from discontinued operations	$ 87

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Leases (Details Narrative) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Jan. 02, 2019
Leases [Abstract]
Operating lease right-of-use asset	$ 500		$ 659
Operating lease liability	715		$ 946
Operating lease expense	$ 159
Operating lease weighted-average discount rate	6.50%