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Subsequent Events
6 Months Ended
Jun. 30, 2022
Subsequent Events [Abstract]  
Subsequent Events

Note 14. Subsequent Events

Proposed Merger

As of the date of this filing, the terms of the Merger with Catheter Precision are under negotiation. The Company cannot provide any assurance that it will effect the Merger or, even if it is able to consummate such a Merger, that the terms of any such Merger will be on the terms set forth in the Term Sheet or that the intended benefits of the Merger will be fully realized. The consummation of the Merger will also be subject to specified conditions precedent to closing that must be satisfied or waived, including certain conditions to closing that are subject to the approval or consent of third parties. The Company cannot provide any assurance that all of the conditions to closing will be satisfied or waived or that it will receive any of the required third party consents or approvals or be able to satisfy or waive all the conditions precedent to closing necessary to consummate the Merger. If the conditions precedent to closing are not satisfied or waived in a timely manner or at all, the Merger may not occur or may be delayed, and the Company may lose some or all of the intended benefits of the Merger with Catheter Precision.

Warrant Repricing

On July 22, 2022, the Company reduced the exercise price of all outstanding warrants, consisting of Series A warrants and Series B warrants, that were issued in the February 2022 public offering from $0.50 per share to $0.28 per share (the “Warrant Repricing”). Following the Warrant Repricing, the Company entered into warrant inducement offer letters (the “Inducement Letters”) with certain investors to immediately exercise all of the Series A warrants and Series B warrants held by such investors. In response to the Inducement Letters, investors exercised approximately 22.2 million Series A warrants and no Series B warrants. Investors who exercised their Series A warrants received Series C warrants to purchase 100% of the shares exercised pursuant to the Series A warrants with an exercise price of $0.28 and a term of five years. The Company received net proceeds of approximately $5.5 million, after issuance costs of approximately $0.7 million, from the exercises of the Series A warrants. The Series C warrants and the shares underlying the Series C warrants are unregistered and were issued in a private placement pursuant to Section 4(a)(2) of the Securities Act.

The Warrant Repricing resulted in an immediate and incremental increase of approximately $2.3 million in the estimated fair value of the Series A warrants and Series B warrants which will be reported in the statement of stockholders’ equity for the three months ended September 30, 2022. Based on the Black-Scholes model, the Company estimated the fair value of the Series C warrants issued to be approximately $2.3 million.

The Company may be obligated to pay a former placement agent Tail Fees on the proceeds received from the Series A warrant exercises and the issuance of the Series C warrants. As a result, the Company may be obligated to pay a cash fee of approximately $0.5 million and issue approximately 1.6 million warrants to purchase common stock at an exercise price of $0.35 per share which represents 125% of the exercise price of the Series C warrants. Such warrants were valued at approximately $0.2 million on the issuance date of the Series C warrants and would be immediately exercisable and expire five years from their issuance date. These warrants had not been issued by the Company as of the date of this filing.

510(k) Clearance

On July 5, 2022, the Company received U.S. Food and Drug Administration 510(k) clearance for its DABRA 2.0 catheter as part of the DABRA Excimer Laser System. This next-generation DABRA catheter features enhancements, including a braided over jacket design that’s intended to improve deliverability and kink resistance when navigating tortuous anatomy, as well as a six-month shelf life.