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Commitments And Contingencies
12 Months Ended
Dec. 31, 2021
Commitments And Contingencies [Abstract]  
Commitments And Contingencies 13. Commitments and Contingencies Loan AgreementOn March 11, 2021, the Company and Robert W. Duggan, the Board Chairman, entered into a Loan Agreement in connection with Mr. Duggan lending the principal sum of $41.0 million to the Company. The Loan Agreement bore interest at a rate per annum equal to 5.0%, payable quarterly commencing on July 1, 2021. During the year ended December 31, 2021, the Company recorded $0.6 million of interest expense in relation to this Loan Agreement. In June 2021, the Loan Agreement was terminated and $41.0 million principal, together with approximately $0.6 million of accrued and unpaid interest, was fully settled via issuance of the Company’s common stock at a price per share of $16.40. Refer to Note 6 for additional details of the private placement sale. Insurance Loan AgreementOn May 13, 2021, the Company secured its annual director and officer liability insurance policy. The total premiums for the policy are approximately $2.6 million, of which the Company made a down payment of $0.7 million and financed the balance of $1.9 million via an Insurance Loan Agreement. The Insurance Loan Agreement has an annual interest rate of 3.69% and requires monthly payments through February 2022, upon which the Insurance Loan Agreement will be paid in full. The outstanding principal portion of the Insurance Loan Agreement, together with any accrued and unpaid interest, is recorded as a note payable in the balance sheet. Operating Leases In January 2017, the Company entered into a five-year lease (the “Existing Lease”) for approximately 15,700 square feet for its corporate headquarters located in Hayward, California. The lease commenced during July 2017. In May 2019, the Company entered into Lease Amendment 1 (the “Lease Amendment”) in relation to the Existing Lease and added the lease of new premises of approximately 13,300 square feet and 21,300 square feet, (“Expansion Premises 1” and “Expansion Premises 2”, respectively). Additionally, the term of the Existing Lease was extended to October 2029 to be coterminous with Expansion Premises 1 and Expansion Premises 2. The Company evaluated the lease amendment under the provisions of ASC 842. It concluded that the Lease Amendment would be accounted for as a single contract with the Existing Lease because the additional lease payments due to the Lease Amendment was not commensurate with the right-of-use asset granted to the Company. Though the Lease Amendment was accounted for as a single contract, the Existing Premises, Expansion Premises 1 (occupied in November 2019) and Expansion Premises 2 (occupied in May 2020) are accounted for as separate lease components. Accordingly, the Company measured and allocated consideration to each lease component as of the modification date. Upon commencement of each lease component, the Company reassessed and calculated the lease liability and right-of-use asset for the respective component. As a result, at the modification date, the Company remeasured its existing lease liability and recorded an additional right-of-use asset and lease liability of $2.0 million. The Company also recorded an additional right-of-use asset and lease liability of $3.0 million and $4.8 million at the commencement of Expansion Premises 1 in November 2019 and Expansion Premises 2 in May 2020, respectively. At December 31, 2021, total right-of-use assets and lease lability was approximately $8.8 million and $10.8 million, respectively. During the years ended December 31, 2021, 2020 and 2019, rent expense, including common area maintenance charges, was $1.9 million, $1.7 million and $0.5 million, respectively. Information related to the Company’s right-of-use assets and related lease liabilities were as follows (in thousands except for remaining lease term and discount rate): Year ending December 31: 2022$ 1,8062023 1,8452024 1,9102025 1,9772026 2,046Thereafter 6,191Total lease payments 15,775Less imputed interest (4,961)Total lease liabilities$ 10,814 Other supplemental information: Cash paid for operating lease liabilities$ 1,643 Current operating lease liabilities 774Non-current operating lease liabilities 10,040Total lease liabilities$ 10,814 Weighted-average remaining lease term 7.83Weighted-average discount rate 10%Legal Proceedings The Company maintains indemnification agreements with its directors and officers that may require the Company to indemnify them against liabilities that arise by reason of their status or service as directors or officers, except as prohibited by applicable law. From time to time, the Company may be involved in a variety of claims, lawsuits, investigations, and proceedings relating to securities laws, corporate governance, product liability and promotion, patent infringement, contract disputes, employment disputes, and other matters relating to various claims that arise in the normal course of the Company’s business, such as demands to inspect Company records and correspondence from the SEC and other government officials. The Company currently believes that these ordinary course matters are not material to the consolidated financial statements of the business; however, the results of litigation and claims are inherently unpredictable. In February 2022, a civil securities lawsuit was filed in the U.S. District Court for the Northern District of California against the Company and certain of its executive officers, following the Company’s announcement on February 8, 2022 that it had received an Additional Information letter from the FDA indicating that the FDA did not believe the Company provided sufficient clinical evidence to support its 510(k) submission to add the treatment of sebaceous hyperplasia to the CellFX System’s current U.S. labeling, and the subsequent decline of the market price of the Company’s common stock. The Company is currently evaluating the case and its allegations. The lawsuit seeks class certification, unspecified damages, fees, costs, and expenses. The Company expects to file a motion to dismiss the case later this year, and an estimate of possible loss or range of loss, if any, cannot be made.