ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) | |
(Address of principal executive offices) |
(Zip Code) |
Title of Class |
Trading Symbol(s) |
Name of each exchange on which registered | ||
Large Accelerated filer | ☐ | Accelerated filer | ☐ | |||
Non-accelerated filer |
☒ | Smaller reporting company | ||||
Emerging growth company |
Page |
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Item 1. |
3 | |||||
Item 1A. |
24 | |||||
Item 1B. |
41 | |||||
Item 2. |
41 | |||||
Item 3. |
42 | |||||
Item 4. |
42 | |||||
Item 5. |
43 | |||||
Item 6. |
43 | |||||
Item 7. |
43 | |||||
Item 7A. |
56 | |||||
Item 8. |
56 | |||||
Item 9. |
56 | |||||
Item 9A. |
57 | |||||
Item 9B. |
57 | |||||
Item 9C. |
57 | |||||
Item 10. |
58 | |||||
Item 11. |
58 | |||||
Item 12. |
58 | |||||
Item 13. |
58 | |||||
Item 14. |
58 | |||||
Item 15. |
59 | |||||
Item 16 |
60 |
Item 1 . |
Business . |
• | anti-kickback, false claims, and physician self-referral statutes; |
• | U.S. state laws and regulations regarding fee splitting and other relationships between healthcare providers and non-professional entities, such as companies that provide management and reimbursement support services; |
• | anti-bribery laws, such as the U.S. Foreign Corrupt Practices Act, the UK Anti-Bribery Act, the Canadian Corruption of Foreign Public Officials Act, and guidance promulgated by certain multi-national groups, such as the United Nations Convention Against Corruption and the Organization for Economic Cooperation and Development Convention on Combatting Bribery of Foreign Public Officials in International Business Transactions; |
• | laws regulating the privacy and security of health data, protected health information and personally identifiable information. These include the U.S. Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), the Health Information Technology for Economic and Clinical Health Act, the |
General Data Protection Regulation (“GDPR”) in the EU, and the Personal Information Protection and Electronic Documents Act in Canada; and |
• | healthcare reform laws in the United States, such as the Affordable Care Act (“ACA”) and the 21st Century Cures Act, which include new regulatory mandates and other measures designed to reduce the rate of medical inflation. These include, among other things, stringent new reporting requirements of financial relationships between device manufacturers and physicians and teaching hospitals. |
• | the referral of an individual for a service or product for which payment may be made by Medicare, Medicaid or other government-sponsored healthcare program; or |
• | purchasing, ordering, arranging for, or recommending the ordering of, any service or product for which payment may be made by a government-sponsored healthcare program. |
• | whether the product or service is a covered benefit under its health plan; |
• | whether the product or service is appropriate and medically necessary for the specific indication; |
• | cost effectiveness of the product or service; |
• | whether the product is being used in a manner consistent with its FDA-approved or cleared label (i.e., “on-label”); and |
• | a determination that the product or service is neither experimental nor investigational (e.g., that its use is supported by relevant evidence in the peer reviewed literature, its use is supported by medical professional society treatment guidelines). |
Item 1A. |
Risk Factors. |
• | The Company has incurred significant losses from inception through 2021 and there can be no assurance that we will be able to achieve and sustain future profitability. |
• | The Company’s quarterly and annual operating and financial results and gross margins are likely to fluctuate significantly in future periods. |
• | Management expects the novel coronavirus (COVID-19) pandemic to continue to have a significant effect on the Company’s results of operations. A continuation or worsening of the pandemic will have a material adverse impact on iCAD’s business, results of operations and financial condition and on the market price of iCAD’s common stock. |
• | The markets for the Company’s products and treatments and newly introduced enhancements to iCAD’s existing products and treatments may not develop as expected, the Company may continue to face barriers to broad market acceptance. |
• | Sales and market acceptance of Company products is dependent upon the coverage and reimbursement decisions made by third-party payers, including carve-out radiology benefits managers. The failure of third-party payers to provide appropriate levels of coverage and reimbursement, and/or meeting prior authorization and other requirements for approval to use Company products and treatments facilitated by the Company’s products could harm the Company’s business and prospects. |
• | A limited number of customers account for a significant portion of the Company’s total revenue. The loss of a principal customer could seriously hurt the Company’s business. |
• | The markets for many of the Company’s products are subject to changing technology. |
• | Revenue from the Company’s new subscription license model may be difficult to predict. |
• | The Company distributes its products in highly competitive markets and the Company’s sales may suffer as a result. |
• | The Company relies on intellectual property and proprietary rights to maintain its competitive position and may not be able to protect these rights. |
• | The Company’s future prospects depend on its ability to retain current key employees and attract additional qualified personnel. |
• | The market price of the Company’s common stock has been, and may continue to be volatile, which could reduce the market price of the Company’s common stock. |
• | Future issuances of shares of the Company’s common stock may cause significant dilution of equity interests of existing holders of common stock and decrease the market price of shares of the Company’s common stock. |
• | market acceptance of the Company’s products; |
• | uncertainty of the development of a market for such product or treatment; |
• | trends relating to, or the introduction or existence of, competing products, technologies or alternative treatments or therapies that may be more effective, safer or easier to use than the Company’s products, technologies, treatments or therapies; |
• | the perceptions of the Company’s products or treatments as compared to other products and treatments; |
• | recommendation and support for the use of the Company’s products or treatments by influential customers, such as hospitals, radiological practices, breast surgeons and radiation oncologists and treatment centers and U.S. and international medical professional societies; |
• | the availability and extent of data demonstrating the clinical efficacy of the Company’s products or treatments; |
• | competition, including the presence of competing products sold by companies with longer operating histories, more recognizable names and more established distribution networks; and |
• | other technological developments. |
• | harm to the Company’s reputation; |
• | lost sales; |
• | delays in commercial releases; |
• | product liability claims; |
• | delays in or loss of market acceptance of the Company’s solutions; |
• | license terminations or renegotiations; |
• | unexpected expenses and diversion of resources to remedy errors; and |
• | privacy and security vulnerabilities. |
• | non-approval of an investigational device exemption (IDE), which is required by the FDA for the study in humans of a significant risk device that is not approved for the indication being studied; |
• | failure to reach an agreement with contract research organizations or clinical trial sites; |
• | failure of third-party contract research organizations to properly implement or monitor the clinical trial protocols; |
• | failure of IRBs to approve the Company’s clinical trial protocols or suspension or termination of the Company’s clinical trial by the IRB, DSMB, or the FDA; |
• | slower than expected rates of patient recruitment and enrollment, which may be further negatively impacted by the COVID-19 global pandemic; |
• | inability to retain patients in clinical trials, which may be further negatively impacted by the COVID-19 global pandemic; |
• | lack of effectiveness during clinical trials; |
• | unforeseen safety issues; |
• | inability or unwillingness of medical clinical investigators and institutional review boards to follow the Company’s clinical trial protocols; |
• | failure of clinical investigators or sites to maintain necessary licenses or permits or comply with good clinical practices, or GCP, or other regulatory requirements; and |
• | lack of sufficient funding to finance the clinical trials. |
Item 1B. |
Unresolved Staff Comments. |
Item 2. |
Properties. |
Item 3. |
Legal Proceedings. |
Item 4. |
Mine Safety Disclosures. |
Item 5. |
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. |
Item 6 . |
Reserved . |
Item 7 . |
Management’s Discussion and Analysis of Financial Condition and Results of Operations . |
For the year ended December 31, |
||||||||||||||||
2021 |
2020 |
$ Change |
% Change |
|||||||||||||
Detection revenue |
||||||||||||||||
Product revenue |
$ | 15,661 | $ | 16,291 | $ | (630 | ) | (3.9 | )% | |||||||
Service and supplies revenue |
6,358 | 5,706 | 652 | 11.4 | % | |||||||||||
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|
|
|||||||||
Subtotal |
22,019 | 21,997 | 22 | 0.1 | % | |||||||||||
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Therapy revenue |
||||||||||||||||
Product revenue |
5,530 | 2,612 | 2,918 | 111.7 | % | |||||||||||
Service and supplies revenue |
6,089 | 5,089 | 1,000 | 19.7 | % | |||||||||||
|
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|
|
|
|
|
|||||||||
Subtotal |
11,619 | 7,701 | 3,918 | 50.9 | % | |||||||||||
|
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|
|
|
|||||||||
$ | 33,638 | $ | 29,698 | $ | 3,940 | 13.3 | % | |||||||||
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|
|
For the year ended December 31, |
||||||||||||||||
2021 |
2020 |
Change |
% Change |
|||||||||||||
Products |
$ | 5,653 | $ | 5,000 | $ | 653 | 13.1 | % | ||||||||
Service and supplies |
3,425 | 2,965 | 460 | 15.5 | % | |||||||||||
Amortization and depreciation |
317 | 379 | (62 | ) | (16.4 | %) | ||||||||||
|
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|
|||||||||
Total cost of revenue |
9,395 | 8,344 | 1,051 | 12.6 | % | |||||||||||
|
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|
|
|
|||||||||
Gross profit |
$ | 24,243 | $ | 21,354 | $ | 2,889 | 13.5 | % | ||||||||
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|
|
|||||||||
Gross profit % |
72.1 | % | 71.9 | % |
For the year ended December 31, |
||||||||||||||||
2021 |
2020 |
Change |
% Change |
|||||||||||||
Detection gross profit |
$ | 18,510 | $ | 17,856 | $ | 654 | 3.7 | % | ||||||||
Therapy gross profit |
5,733 | 3,498 | 2,235 | 63.9 | % | |||||||||||
|
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|
|
|
|
|
|||||||||
Gross profit |
$ | 24,243 | $ | 21,354 | $ | 2,889 | 13.5 | % | ||||||||
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|
For the year ended December 31, |
||||||||||||||||
2021 | 2020 | Change | % Change | |||||||||||||
Operating expenses: |
||||||||||||||||
Engineering and product development |
$ | 9,194 | $ | 8,114 | $ | 1,080 | 13.3 | % | ||||||||
Marketing and sales |
15,135 | 13,312 | 1,823 | 13.7 | % | |||||||||||
General and administrative |
10,406 | 9,117 | 1,289 | 14.1 | % | |||||||||||
Amortization and depreciation |
240 | 199 | 41 | 20.6 | % | |||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total operating expenses |
$ | 34,975 | $ | 30,742 | $ | 4,233 | 13.8 | % | ||||||||
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|
|
|
|
|
For the year ended December 31, |
||||||||||||||||
2021 | 2020 | Change | Change % | |||||||||||||
Interest expense |
$ | (141 | ) | $ | (476 | ) | 335 | (70.4 | )% | |||||||
Interest income |
15 | 97 | (82 | ) | (84.5 | )% | ||||||||||
Loss on extinguishment of debt |
(386 | ) | (341 | ) | (45 | ) | 13.2 | % | ||||||||
Loss on fair value of debentures |
— | (7,464 | ) | 7,464 | (100.0 | )% | ||||||||||
|
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|
|
|
|
|
|
|||||||||
Total other expense |
$ | (512 | ) | $ | (8,184 | ) | $ | 7,672 | (93.7 | )% | ||||||
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|||||||||
Income tax expense |
$ | 1 | $ | 38 | (37 | ) | (97.4 | )% |
Twelve months ended December 31, |
||||||||||||||||
2020 |
2019 |
$ Change |
% Change |
|||||||||||||
Detection revenue |
||||||||||||||||
Product revenue |
$ | 16,291 | $ | 16,788 | $ | (497 | ) | (3.0 | )% | |||||||
Service revenue |
5,706 | 5,531 | 175 | 3.2 | % | |||||||||||
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|
|||||||||
Subtotal |
21,997 | 22,319 | (322 | ) | (1.4 | )% | ||||||||||
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|||||||||
Therapy revenue |
||||||||||||||||
Product revenue |
2,612 | 2,979 | (367 | ) | (12.3 | )% | ||||||||||
Service revenue |
5,089 | 6,042 | (953 | ) | (15.8 | )% | ||||||||||
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|
|||||||||
Subtotal |
7,701 | 9,021 | (1,320 | ) | (14.6 | )% | ||||||||||
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|
|
|||||||||
Total revenue |
$ | 29,698 | $ | 31,340 | $ | (1,642 | ) | (5.2 | )% | |||||||
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Twelve months ended December 31, |
||||||||||||||||
2020 |
2019 |
Change |
% Change |
|||||||||||||
Products |
$ | 5,000 | $ | 3,278 | $ | 1,722 | 52.5 | % | ||||||||
Service and supplies |
2,965 | 3,438 | (473 | ) | (13.8 | )% | ||||||||||
Amortization and depreciation |
379 | 397 | (18 | ) | 100.0 | % | ||||||||||
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|
|||||||||
Total cost of revenue |
$ | 8,344 | $ | 7,113 | $ | 1,231 | 17.3 | % | ||||||||
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|
|||||||||
Gross profit |
$ | 21,354 | $ | 24,227 | $ | (2,873 | ) | (11.9 | )% | |||||||
profit % |
71.9 | % | 77.3 | % |
For the year ended December 31, |
||||||||||||||||
2020 |
2019 |
Change |
% Change |
|||||||||||||
Detection gross profit |
$ | 17,856 | $ | 18,627 | $ | (771 | ) | (4.1 | )% | |||||||
Therapy gross profit |
3,498 | 5,600 | (2,102 | ) | (37.5 | )% | ||||||||||
|
|
|
|
|
|
|
|
|||||||||
Gross profit |
$ | 21,354 | $ | 24,227 | $ | (2,873 | ) | (11.9 | )% | |||||||
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|
Year ended December 31, |
||||||||||||||||
2020 | 2019 | Change | Change % | |||||||||||||
Operating expenses: |
||||||||||||||||
Engineering and product development |
$ | 8,114 | $ | 9,271 | $ | (1,157 | ) | (12.5 | )% | |||||||
Marketing and sales |
13,312 | 13,634 | (322 | ) | (2.4 | )% | ||||||||||
General and administrative |
9,117 | 7,443 | 1,674 | 22.5 | % | |||||||||||
Amortization and depreciation |
199 | 276 | (77 | ) | (27.9 | )% | ||||||||||
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|
|||||||||
Total operating expenses |
$ | 30,742 | $ | 30,624 | $ | 118 | 0.4 | % | ||||||||
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|
Year ended December 31, |
||||||||||||||||
2020 | 2019 | Change | Change % | |||||||||||||
Interest expense |
$ | (476 | ) | $ | (784 | ) | $ | 308 | (39.3 | )% | ||||||
Interest income |
97 | 344 | (247 | ) | (71.8 | )% | ||||||||||
Loss on extinguishment of debt |
(341 | ) | — | (341 | ) | 0.0 | % | |||||||||
Loss on fair value of debentures |
(7,464 | ) | (6,671 | ) | (793 | ) | 11.9 | % | ||||||||
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|||||||||
$ | (8,184 | ) | $ | (7,111 | ) | $ | (1,073 | ) | 15.1 | % | ||||||
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Tax expense |
$ | 38 | $ | 43 | $ | (5 | ) | (11.6 | )% |
Year Ended December 31, | ||||||||||||
2021 | 2020 | 2019 | ||||||||||
Segment revenues: |
||||||||||||
Detection |
$ | 22,019 | $ | 21,997 | $ | 22,319 | ||||||
Therapy |
11,619 | 7,701 | 9,021 | |||||||||
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Total Revenue |
$ | 33,638 | $ | 29,698 | $ | 31,340 | ||||||
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Segment gross profit: |
||||||||||||
Detection |
$ | 18,510 | $ | 17,856 | $ | 18,627 | ||||||
Therapy |
5,733 | 3,498 | 5,600 | |||||||||
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Total gross profit |
$ | 24,243 | $ | 21,354 | $ | 24,227 | ||||||
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Year Ended December 31, | ||||||||||||
2021 | 2020 | 2019 | ||||||||||
Segment operating income (loss): |
||||||||||||
Detection |
$ | 1,563 | $ | 2,719 | $ | 2,564 | ||||||
Therapy |
(1,835 | ) | (3,028 | ) | (1,476 | ) | ||||||
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Segment operating income (loss) |
$ | (272 | ) | $ | (309 | ) | $ | 1,088 | ||||
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General administrative |
$ | (10,460 | ) | $ | (9,079 | ) | $ | (7,486 | ) | |||
Interest expense |
(141 | ) | (476 | ) | (784 | ) | ||||||
Loss on extinguishment of debt |
(386 | ) | (341 | ) | — | |||||||
Other income |
15 | 97 | 345 | |||||||||
Fair value of convertible debentures |
— | (7,464 | ) | (6,671 | ) | |||||||
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Loss before income tax |
$ | (11,244 | ) | $ | (17,572 | ) | $ | (13,508 | ) | |||
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Item 7A. |
Quantitative and Qualitative Disclosures about Market Risk. |
Item 8. |
Financial Statements and Supplementary Data. |
Item 9. |
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure. |
Item 9A. |
Controls and Procedures. |
Item 9B. |
Other Information. |
Item 9C. |
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections. |
Item 10 . |
Directors, Executive Officers and Corporate Governance . |
Item 11 . |
Executive Compensation . |
Item 12 . |
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters . |
Item 13 . |
Certain Relationships and Related Transactions, and Director Independence . |
Item 14 . |
Principal Accounting Fees and Services . |
Item 15 . |
Exhibits, Financial Statement Schedules. |
* | Denotes a management compensation plan or arrangement. |
** | The Registrant has omitted certain schedules and exhibits pursuant to Item 601(b)(2) of Regulation S-K and shall furnish supplementally to the SEC copies any of the omitted schedules and exhibits upon request by the SEC. |
Item 16. |
Form 10-K Summary. |
By: | /s/ Stacey Stevens | |
Stacey Stevens | ||
Chief Executive Officer, President and Director |
Signature |
Title |
Date | ||
/s/ Stacey Stevens Stacey Stevens |
Chief Executive Officer, President, Director, (Principal Executive Officer) |
March 28, 2022 | ||
/s/ Charles R. Carter Charles R. Carter |
Chief Financial Officer (Principal Financial and Accounting Officer) |
March 28, 2022 | ||
/s/ Michael Klein Michael Klein |
Chairman, Director |
March 28, 2022 | ||
/s/ Dana Brown |
Director | March 28, 2022 | ||
Dana Brown |
||||
/s/ Timothy Norris Irish |
Director | March 28, 2022 | ||
Timothy Norris Irish |
||||
/s/ Nathaniel Dalton |
Director | March 28, 2022 | ||
Nathaniel Dalton |
||||
/s/ Rakesh Patel |
Director | March 28, 2022 | ||
Rakesh Patel, MD |
||||
/s/ Andy Sassine |
Director | March 28, 2022 | ||
Andy Sassine |
||||
/s/ Susan Wood |
Director | March 28, 2022 | ||
Susan Wood, Ph.D. |
Page |
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F-2 |
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F-4 |
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F-5 |
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F-6 |
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F-7 |
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F-8–F-35 |
• |
Evaluating management’s accounting policies and practices, including the reasonableness of management’s judgments and assumptions related to the identification of each distinct performance obligation and its pattern of delivery. |
• |
Testing a sample of these revenue agreements together with their underlying documents to evaluate management’s identification of each distinct performance obligation and its respective pattern of revenue recognition. |
December 31, |
December 31, |
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Assets |
2021 |
2020 |
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(in thousands except shares and per share data) |
Current assets: |
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Cash and cash equivalents |
$ | $ | ||||||
Trade accounts receivable, net of allowance for doubtful accounts of $ |
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Inventory, net |
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Prepaid expenses and other current assets |
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Total current assets |
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Property and equipment: |
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Equipment |
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Leasehold improvements |
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Furniture and fixtures |
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Marketing assets |
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Less accumulated depreciation and amortization |
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Property and equipment, net |
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Other assets: |
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Operating lease assets |
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Other assets |
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Intangible assets, net of accumulated amortization of $ |
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Goodwill |
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Total other assets |
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Total assets |
$ | $ | ||||||
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Liabilities and Stockholders’ Equity |
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Current liabilities: |
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Accounts payable |
$ | $ | ||||||
Accrued and other expenses |
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Lease payable, current |
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Deferred revenue, current |
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Total current liabilities |
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Lease payable, long-term |
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Deferred revenue, long-term |
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Notes payable, long-term |
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Deferred tax |
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Total liabilities |
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Commitments and contingencies (Note 15) |
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Stockholders’ equity: |
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Preferred stock, $ |
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Common stock, $ |
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Additional paid-in capital |
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Accumulated deficit |
( |
) | ( |
) | ||||
Treasury stock at cost, |
( |
) | ( |
) | ||||
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Total stockholders’ equity |
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Total liabilities and stockholders’ equity |
$ | $ | ||||||
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For the Years Ended December 31, |
||||||||||||
2021 |
2020 |
2019 |
||||||||||
(in thousands except per share data) | ||||||||||||
Revenue: |
||||||||||||
Products |
$ | $ | $ | |||||||||
Service and supplies |
||||||||||||
Total revenue |
||||||||||||
Cost of Revenue: |
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Products |
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Service and supplies |
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Amortization and depreciation |
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Total cost of revenue |
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Gross profit |
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Operating expenses: |
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Engineering and product development |
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Marketing and sales |
||||||||||||
General and administrative |
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Amortization and depreciation |
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Total operating expenses |
||||||||||||
Loss from operations |
( |
) | ( |
) | ( |
) | ||||||
Other expense |
||||||||||||
Interest expense |
( |
) | ( |
) | ( |
) | ||||||
Interest income |
||||||||||||
Loss on extinguishment of debt |
( |
) | ( |
) | ||||||||
Loss on fair value of convertible debentures |
( |
) | ( |
) | ||||||||
Other expense, net |
( |
) | ( |
) | ( |
) | ||||||
Loss before income tax expense |
( |
) | ( |
) | ( |
) | ||||||
Income tax expense |
||||||||||||
Net loss and comprehensive loss |
$ | ( |
) | $ | ( |
) | $ | ( |
) | |||
Net loss per share: |
||||||||||||
Basic |
$ | ( |
) | $ | ( |
) | $ | ( |
) | |||
Diluted |
$ | ( |
) | $ | ( |
) | $ | ( |
) | |||
Weighted average number of shares used in computing net loss per share: |
||||||||||||
Basic |
||||||||||||
Diluted |
Common Stock |
Additional Paid-in Capital |
|||||||||||||||||||||||
Number of Shares Issued |
Par Value |
Accumulated Deficit |
Treasury Stock |
Stockholders’ Equity |
||||||||||||||||||||
Balance at December 31, 2018 |
$ | $ | $ | ( |
) | $ | ( |
) | $ | |||||||||||||||
Issuance of common stock relative to vesting of restricted stock, net of |
( |
) | — | — | ( |
) | ||||||||||||||||||
Issuance of common stock pursuant to stock option plans |
— | — | ||||||||||||||||||||||
Issuance of common stock, net |
— | — | ||||||||||||||||||||||
Stock-based compensation |
— | — | — | — | ||||||||||||||||||||
Net Loss |
— | — | — | ( |
) | — | ( |
) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Balance at December 31, 2019 |
$ | $ | $ | ( |
) | $ | ( |
) | $ | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Issuance of common stock relative to vesting of restricted stock, net of |
( |
) | — | — | ( |
) | ||||||||||||||||||
Issuance of common stock pursuant to stock option plans |
— | — | ||||||||||||||||||||||
Issuance of common stock, net |
— | — | ||||||||||||||||||||||
Issuance of common stock pursuant employee stock purchase plan |
— | — | ||||||||||||||||||||||
Issuance of common stock upon conversion of debentures |
— | — | ||||||||||||||||||||||
Stock-based compensation |
— | — | — | — | ||||||||||||||||||||
Net loss |
— | — | — | ( |
) | — | ( |
) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Balance at December 31, 2020 |
$ | $ | $ | ( |
) | $ | ( |
) | $ | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Issuance of common stock relative to vesting of restricted stock, net of |
( |
) | — | — | ( |
) | ||||||||||||||||||
Issuance of common stock pursuant to stock option plans |
— | — | ||||||||||||||||||||||
Issuance of common stock, net |
— | — | ||||||||||||||||||||||
Issuance of common stock pursuant to employee stock purchase plan |
— | — | ||||||||||||||||||||||
Stock-based compensation |
— | — | — | — | ||||||||||||||||||||
Net loss |
— | — | — | ( |
) | — | ( |
) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Balance at December 31, 2021 |
$ | $ | $ | ( |
) | $ | ( |
) | $ | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
For the Years Ended December 31, |
||||||||||||
2021 |
2020 |
2019 |
||||||||||
(in thousands) | ||||||||||||
Cash flow from operating activities: |
||||||||||||
Net loss |
$ | ( |
) | $ | ( |
) | $ | ( |
) | |||
Adjustments to reconcile net loss to net cash used for operating activities: |
||||||||||||
Amortization |
||||||||||||
Depreciation |
||||||||||||
Bad debt provision |
||||||||||||
Stock-based compensation expense |
||||||||||||
Amortization of debt discount and debt costs |
||||||||||||
Loss on extinguishment of debt |
— | |||||||||||
Deferred tax |
||||||||||||
Loss on disposal of assets |
— | — | ||||||||||
Change in fair value of convertible debentures |
— | |||||||||||
Changes in operating assets and liabilities, net of acquisition: |
||||||||||||
Accounts receivable |
( |
) | ( |
) | ||||||||
Inventory |
( |
) | ( |
) | ( |
) | ||||||
Prepaid and other assets |
( |
) | ||||||||||
Accounts payable |
( |
) | ||||||||||
Accrued and other expenses |
( |
) | ( |
) | ||||||||
Deferred revenue |
( |
) | ||||||||||
|
|
|
|
|
|
|||||||
Total adjustments |
||||||||||||
|
|
|
|
|
|
|||||||
Net cash used for operating activities |
( |
) | ( |
) | ( |
) | ||||||
|
|
|
|
|
|
|||||||
Cash flow used for investing activities: |
||||||||||||
Additions to patents, technology and other |
( |
) | ( |
) | ( |
) | ||||||
Additions to property and equipment |
( |
) | ( |
) | ( |
) | ||||||
|
|
|
|
|
|
|||||||
Net cash used for investing activities |
( |
) | ( |
) | ( |
) | ||||||
|
|
|
|
|
|
|||||||
Cash flow from financing activities: |
||||||||||||
Issuance of common stock for cash, net |
||||||||||||
Issuance of common stock pursuant to Employee Stock Purchase Plan |
— | |||||||||||
Issuance of common stock pursuant to stock option plans |
||||||||||||
Taxes paid related to restricted stock issuance |
( |
) | ( |
) | ( |
) | ||||||
Principal payments of capital lease obligations |
— | — | ( |
) | ||||||||
Proceeds from notes payable |
— | |||||||||||
Principal repayment of notes payable |
( |
) | ( |
) | ( |
) | ||||||
Debt issuance costs |
— | ( |
) | — | ||||||||
Proceeds from line of credit |
— | |||||||||||
Repayment of line of credit |
— | ( |
) | ( |
) | |||||||
|
|
|
|
|
|
|||||||
Net cash provided by financing activities |
||||||||||||
|
|
|
|
|
|
|||||||
Increase in cash and equivalents |
||||||||||||
Cash and equivalents, beginning of year |
||||||||||||
|
|
|
|
|
|
|||||||
Cash and equivalents, end of year |
$ | $ | $ | |||||||||
|
|
|
|
|
|
|||||||
Supplemental disclosure of cash flow information: |
||||||||||||
Interest paid |
$ | $ | $ | |||||||||
|
|
|
|
|
|
|||||||
Taxes paid |
$ | $ | $ | |||||||||
|
|
|
|
|
|
|||||||
Right-of-use |
||||||||||||
|
|
|
|
|
|
|||||||
Issuance of common stock upon conversion of debentures |
$ | |||||||||||
|
|
|
|
|
|
• | significant and sustained underperformance relative to historical or projected future operating results; |
• | significant changes in the manner or use of the Company’s assets in the strategy for the Company’s overall business; |
• | significant negative industry or economic trends; |
• | significant and sustained decline in the Company’s stock price; and |
• | a decline in the Company’s market capitalization below net book value. |
• |
A significant decrease in the market price of a long-lived asset (asset group); |
• |
A significant adverse change in the extent or manner in which a long-lived asset (asset group) is being used or in its physical condition; |
• |
A significant adverse change in legal factors or in the business climate that could affect the value of a long-lived asset (asset group), including an adverse action or assessment by a regulator; |
• |
An accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of a long-lived asset (asset group); |
• |
A current period operating or cash flow loss combined with a history of operating or cash flow losses or a projection or forecast that demonstrates continuing losses associated with the use of a long-lived asset (asset group). |
1) |
Identify the contract(s) with a customer |
2) |
Identify the performance obligations in the contract |
3) |
Determine the transaction price , the Company estimates the amount of variable consideration that should be included in the transaction price utilizing either the expected value method or the most likely amount method depending on the nature of the variable consideration. Variable consideration is included in the transaction price if, in the Company’s judgment, it is probable that a significant future reversal of cumulative revenue under the contract will not occur. |
4) |
Allocate the transaction price to the performance obligations in the contract that contain multiple performance obligations require an allocation of the transaction price to each performance obligation on a relative Stand-alone Sales Price (“SSP”) basis unless the transaction price is variable and meets the criteria to be allocated entirely to a |
performance obligation or to a distinct good or service that forms part of a performance obligation. The Company determines SSP based on the price at which the performance obligation is sold separately. If the SSP is not observable through past transactions, the Company estimates the SSP taking into account available information such as market conditions and internally approved pricing guidelines related to the performance obligations. |
5) |
Recognize revenue when (or as) the Company satisfies a performance obligation |
• | Level 1 - Quoted prices in active markets for identical assets or liabilities. |
• | Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. |
• | Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value |
Fair Value Measurements (in thousands) as of December 31, 2021 |
||||||||||||||||
Level 1 |
Level 2 |
Level 3 |
Total |
|||||||||||||
Assets |
||||||||||||||||
Money market accounts |
$ | — | — | $ | ||||||||||||
Total Assets |
$ | — | — | $ | ||||||||||||
Fair Value Measurements (in thousands) as of December 31, 2020 |
||||||||||||||||
Level 1 |
Level 2 |
Level 3 |
Total |
|||||||||||||
Assets |
||||||||||||||||
Money market accounts |
$ | $ | — | $ | — | $ | ||||||||||
Total Assets |
$ | $ | — | $ | — | $ | ||||||||||
Convertible Debentures | ||||
Balance, December 31, 2019 |
$ | |||
Issuances |
||||
Fair value adjustments |
||||
Conversion |
( |
) | ||
Balance, December 31, 2020 |
$ | |||
Year ended December 31, 2021 |
||||||||||||
Reportable Segments |
||||||||||||
Detection |
Therapy |
Total |
||||||||||
Major Goods/Service Lines |
||||||||||||
Products |
$ | $ | $ | |||||||||
Service contracts |
||||||||||||
Supply and source usage agreements |
— | |||||||||||
Professional services |
— | |||||||||||
|
|
|
|
|
|
|||||||
$ | $ | $ | ||||||||||
|
|
|
|
|
|
|||||||
Timing of Revenue Recognition |
||||||||||||
Goods transferred at a point in time |
$ | $ | $ | |||||||||
Services transferred over time |
||||||||||||
|
|
|
|
|
|
|||||||
$ | $ | $ | ||||||||||
|
|
|
|
|
|
|||||||
Sales Channels |
||||||||||||
Direct sales force |
$ | $ | $ | |||||||||
OEM partners |
— | |||||||||||
Channel partners |
— | |||||||||||
|
|
|
|
|
|
|||||||
$ | $ | $ | ||||||||||
|
|
|
|
|
|
Year ended December 31, 2020 |
||||||||||||
Reportable Segments |
||||||||||||
Detection |
Therapy |
Total |
||||||||||
Major Goods/Service Lines |
||||||||||||
Products |
$ | $ | $ | |||||||||
Service contracts |
||||||||||||
Supply and source usage agreements |
— | |||||||||||
Professional services |
— | |||||||||||
Other |
||||||||||||
|
|
|
|
|
|
|||||||
$ | $ | $ | ||||||||||
|
|
|
|
|
|
|||||||
Timing of Revenue Recognition |
||||||||||||
Goods transferred at a point in time |
$ | $ | $ | |||||||||
Services transferred over time |
||||||||||||
|
|
|
|
|
|
|||||||
$ | $ | $ | ||||||||||
|
|
|
|
|
|
|||||||
Sales Channels |
||||||||||||
Direct sales force |
$ | $ | $ | |||||||||
OEM partners |
— | |||||||||||
Channel partners |
— | |||||||||||
|
|
|
|
|
|
|||||||
$ | $ | $ | ||||||||||
|
|
|
|
|
|
Year ended December 31, 2019 |
||||||||||||
Reportable Segments |
||||||||||||
Detection |
Therapy |
Total |
||||||||||
Major Goods/Service Lines |
||||||||||||
Products |
$ | $ | $ | |||||||||
Service contracts |
||||||||||||
Supply and source usage agreements |
— | |||||||||||
Professional services |
— | |||||||||||
Other |
||||||||||||
|
|
|
|
|
|
|||||||
$ | $ | $ | ||||||||||
|
|
|
|
|
|
|||||||
Timing of Revenue Recognition |
||||||||||||
Goods transferred at a point in time |
$ | $ | $ | |||||||||
Services transferred over time |
||||||||||||
|
|
|
|
|
|
|||||||
$ | $ | $ | ||||||||||
|
|
|
|
|
|
|||||||
Sales Channels |
||||||||||||
Direct sales |
$ | $ | $ | |||||||||
OEM partners |
— | |||||||||||
Channel partners |
— | |||||||||||
|
|
|
|
|
|
|||||||
$ | $ | $ | ||||||||||
|
|
|
|
|
|
Balance at December 31, 2021 |
Balance at December 31, 2020 |
|||||||
Receivables, which are included in ‘Trade accounts receivable’ |
$ | $ | ||||||
Current contract assets, which are included in “Prepaid and other assets” |
$ | $ | ||||||
Non-current contract assets, which are included in “other assets” |
$ | $ | ||||||
Contract liabilities, which are included in “Deferred revenue” |
$ | $ |
Year Ended December 31, 2021 |
Year Ended December 31, 2020 |
|||||||
Balance at beginning of period |
$ | $ | ||||||
Deferral of revenue |
||||||||
Recognition of deferred revenue |
( |
) | ( |
) | ||||
Balance at end of period |
$ | $ | ||||||
Years Ended December 31, |
||||||||
2021 |
2020 |
|||||||
Balance at beginning of period |
$ | $ | ||||||
Deferral of costs to obtain a contract |
||||||||
Recognition of costs to obtain a contract |
( |
) | ( |
) | ||||
Balance at end of period |
$ | $ | ||||||
2021 |
2020 |
2019 |
||||||||||
Net loss available to common shareholders |
$ | ( |
) | $ | ( |
) | $ | ( |
) | |||
Basic shares used in the calculation of earnings per share |
||||||||||||
Effect of dilutive securities: |
||||||||||||
Stock options |
— | — | — | |||||||||
Restricted stock |
— | — | — | |||||||||
Diluted shares used in the calculation of earnings per share |
||||||||||||
Net loss per share |
||||||||||||
Basic |
$ | ( |
) |
$ | ( |
) | $ | ( |
) | |||
Diluted |
$ | ( |
) |
$ | ( |
) | $ | ( |
) |
Year Ended December 31, |
||||||||||||
2021 |
2020 |
2019 |
||||||||||
Common stock options |
||||||||||||
Restricted Stock |
||||||||||||
Convertible Debentures |
— | — | ||||||||||
2021 |
2020 |
2019 |
||||||||||
Balance at beginning of period |
$ | $ | $ | |||||||||
Additions charged to costs and expenses |
||||||||||||
Reductions |
( |
) | ( |
) | ( |
) | ||||||
Balance at end of period |
$ | $ | $ | |||||||||
December 31, 2021 |
December 31, 2020 |
|||||||
Raw materials |
$ | $ | ||||||
Work in process |
||||||||
Finished Goods |
||||||||
|
|
|
|
|||||
Inventory Gross |
||||||||
Inventory Reserve |
( |
) | ( |
) | ||||
|
|
|
|
|||||
Inventory Net |
$ | $ | ||||||
|
|
|
|
2021 |
2020 |
2019 |
Weighted average useful life |
|||||||||||||
Gross Carrying Amount |
||||||||||||||||
Patents and licenses |
$ | $ | $ | |||||||||||||
Technology |
||||||||||||||||
Customer relationships |
||||||||||||||||
Tradename |
||||||||||||||||
|
|
|
|
|
|
|||||||||||
Total amortizable intangible assets |
||||||||||||||||
|
|
|
|
|
|
|||||||||||
Accumulated Amortization |
||||||||||||||||
Patents and licenses |
$ | $ | $ | |||||||||||||
Technology |
||||||||||||||||
Customer relationships |
||||||||||||||||
Tradename |
||||||||||||||||
|
|
|
|
|
|
|||||||||||
Total accumulated amortization |
||||||||||||||||
|
|
|
|
|
|
|||||||||||
Total amortizable intangible assets, net |
$ | $ | $ | |||||||||||||
|
|
|
|
|
|
For the years ended December 31: |
Estimated amortization expense |
|||
2022 |
||||
2023 |
||||
2024 |
||||
2025 |
||||
2026 |
||||
|
|
|||
$ | ||||
|
|
2021 | 2020 | |||||||
Accrued salary and related expenses |
$ | $ | ||||||
Accrued accounts payable |
||||||||
Accrued professional fees |
||||||||
Other accrued expenses |
||||||||
|
|
|
|
|||||
$ |
$ |
|||||||
|
|
|
|
Year Ended December 31, |
||||||||||
Lease Cost |
Classification |
2021 |
2020 |
|||||||
Operating lease cost - Right of Use |
Operating expenses | $ | $ | |||||||
Operating lease cost - Variable Costs |
Operating expenses | |||||||||
|
|
|
|
|||||||
Total |
$ | $ | ||||||||
|
|
|
|
Year Ended December 31, |
||||||||
2021 |
2020 |
|||||||
Cash paid for operating cash flows from operating leases |
$ | $ |
As of December 31, |
||||||||
2021 |
2020 |
|||||||
Weighted-average remaining lease term of operating leases (in years) |
||||||||
Weighted-average discount rate for operating leases |
% | % |
Year Ended December 31: |
Total |
|||
2022 |
||||
2023 |
||||
2024 |
||||
|
|
|||
Total lease payments |
||||
Less: imputed interest |
( |
) | ||
|
|
|||
Total lease liabilities |
||||
Less: current portion of lease liabilities |
( |
) | ||
|
|
|||
lease liabilities |
$ | |||
|
|
Number of Shares |
Weighted Average Exercise Price |
Weighted Average Remaining Contractual Term |
||||||||||
Outstanding, December 31, 2019 |
$ | |||||||||||
Granted |
$ | |||||||||||
Exercised |
( |
) | $ | |||||||||
Forfeited |
( |
) | $ | |||||||||
|
|
|
|
|||||||||
Outstanding, December 31, 2020 |
$ | |||||||||||
Granted |
$ | |||||||||||
Exercised |
( |
) | $ | |||||||||
Forfeited |
( |
) | $ | |||||||||
|
|
|
|
|||||||||
Outstanding, December 31, 2021 |
$ | |||||||||||
Exercisable at December 31, 2019 |
$ | |||||||||||
|
|
|
|
|||||||||
Exercisable at December 31, 2020 |
$ | |||||||||||
|
|
|
|
|||||||||
Exercisable at December 31, 2021 |
$ | |||||||||||
|
|
|
|
Year Ended December 31, |
||||||||||||
2021 |
2020 |
2019 |
||||||||||
Cost of revenue |
$ | $ | $ | |||||||||
Engineering and product development |
||||||||||||
Marketing and sales |
||||||||||||
General and administrative expense |
||||||||||||
|
|
|
|
|
|
|||||||
$ |
$ |
$ |
||||||||||
|
|
|
|
|
|
Year Ended December 31, |
||||||||||||
2021 |
2020 |
2019 |
||||||||||
Average risk-free interest rate |
% | % | % | |||||||||
Expected dividend yield |
||||||||||||
Expected life |
||||||||||||
Expected volatility |
2 % |
% | % | |||||||||
Weighted average fair value |
$ |
$ |
$ |
Year Ended December 31, |
||||||||||||
2021 |
2020 |
2019 |
||||||||||
Outstanding |
$ | $ | $ | |||||||||
Exercisable |
$ | $ | $ | |||||||||
Exercised |
$ | $ | $ | |||||||||
Company’s stock price at December 31 |
$ | $ | $ |
Year Ended December 31, |
||||||||||||
2021 |
2020 |
2019 |
||||||||||
Beginning outstanding balance |
||||||||||||
Granted |
||||||||||||
Vested |
( |
) | ( |
) | ( |
) | ||||||
Forfeited |
( |
) | ( |
) | ||||||||
|
|
|
|
|
|
|||||||
Ending outstanding balance |
||||||||||||
|
|
|
|
|
|
2021 | 2020 | 2019 | ||||||||||
Current provision: |
||||||||||||
Federal |
$ | $ | — | $ | — | |||||||
State |
||||||||||||
Foreign |
— | — | ||||||||||
|
|
|
|
|
|
|||||||
$ | $ | $ | ||||||||||
|
|
|
|
|
|
|||||||
Deferred provision: |
||||||||||||
Federal |
$ | $ | $ | |||||||||
State |
— | — | ||||||||||
Foreign |
— | — | ||||||||||
|
|
|
|
|
|
|||||||
$ | $ | $ | ||||||||||
|
|
|
|
|
|
|||||||
Total |
$ | $ | $ | |||||||||
|
|
|
|
|
|
2021 | 2020 | 2019 | ||||||||||
Federal statutory rate |
% | % | % | |||||||||
State income taxes, net of federal benefit |
% | % | % | |||||||||
Net state impact of deferred rate change |
% | ( |
%) | ( |
%) | |||||||
Stock compensation expense |
% | % | ( |
%) | ||||||||
Other permanent differences |
( |
%) | ( |
%) | % | |||||||
Change in valuation allowance |
( |
%) | ( |
%) | ( |
%) | ||||||
Tax credits |
% | % | % | |||||||||
Accrual to TR |
( |
%) | % | % | ||||||||
FV Mark to market on convertible notes |
% | ( |
%) | ( |
%) | |||||||
Foreign Rate Differential |
% | % | % | |||||||||
True Ups - NOL Expiration/162(m) limits |
( |
%) | ( |
%) | % | |||||||
|
|
|
|
|
|
|||||||
Effective income tax |
% | ( |
%) | ( |
%) | |||||||
|
|
|
|
|
|
2021 | 2020 | |||||||
Inventory (Section 263A) |
$ | $ | ||||||
Inventory reserves |
||||||||
Receivable reserves |
||||||||
Other accruals |
||||||||
Deferred revenue |
||||||||
Accumulated depreciation/amortization |
||||||||
Stock options |
||||||||
Developed technology |
||||||||
Tax credits |
||||||||
NOL carryforward |
||||||||
Lease Liability |
||||||||
|
|
|
|
|||||
Deferred tax assets |
||||||||
Valuation allowance |
( |
) | ( |
) | ||||
Right of Use Asset |
( |
) | ( |
) | ||||
Goodwill tax amortization |
( |
) | ( |
) | ||||
|
|
|
|
|||||
Deferred tax liability |
$ | ( |
) | $ | ( |
) | ||
|
|
|
|
Year Ended December 31, | ||||||||||||
2021 | 2020 | 2019 | ||||||||||
Segment revenues: |
||||||||||||
Detection |
$ | $ | $ | |||||||||
Therapy |
||||||||||||
|
|
|
|
|
|
|||||||
Total Revenue |
$ | $ | $ | |||||||||
|
|
|
|
|
|
|||||||
Segment gross profit: |
||||||||||||
Detection |
$ | $ | $ | |||||||||
Therapy |
||||||||||||
|
|
|
|
|
|
|||||||
Total gross profit |
$ | $ | $ | |||||||||
|
|
|
|
|
|
|||||||
Segment operating income (loss): |
||||||||||||
Detection |
$ | $ | $ | |||||||||
Therapy |
( |
) | ( |
) | ( |
) | ||||||
|
|
|
|
|
|
|||||||
Segment operating income (loss) |
$ | ( |
) | $ | ( |
) | $ | |||||
|
|
|
|
|
|
|||||||
General administrative |
$ | ( |
) | $ | ( |
) | $ | ( |
) | |||
Interest expense |
( |
) | ( |
) | ( |
) | ||||||
Loss on extinguishment of debt |
( |
) | ( |
) | — |
|||||||
Other income |
||||||||||||
Fair value of convertible debentures |
( |
) | ( |
) | ||||||||
|
|
|
|
|
|
|||||||
Loss before income tax |
$ | ( |
) | $ | ( |
) | $ | ( |
) | |||
|
|
|
|
|
|
Year Ended December 31, | ||||||||||||
2021 | 2020 | 2019 | ||||||||||
Detection depreciation and amortization |
||||||||||||
Depreciation |
$ | $ | $ | |||||||||
Amortization |
$ | |||||||||||
Therapy depreciation and amortization |
||||||||||||
Depreciation |
$ | $ | $ | |||||||||
Amortization |
$ |
Percent of Export sales |
||||||||||||
Region |
2021 | 2020 | 2019 | |||||||||
Europe |
% | % | % | |||||||||
Taiwan |
% | % | % | |||||||||
Canada |
% | % | % | |||||||||
China |
% | % | % | |||||||||
Other |
% | % | % | |||||||||
Total |
% | % | % | |||||||||
Total Export Revenue |
$ | $ | $ |
Percent of Export sales |
||||||||||||
Region |
2021 | 2020 | 2019 | |||||||||
France |
% | % | % | |||||||||
Spain |
% | % | % | |||||||||
Russia |
% | % | % | |||||||||
Switzerland |
% | % | % | |||||||||
Italy |
% | % | % | |||||||||
Germany |
% | % | % | |||||||||
United Kingdom |
% | % | % |
Input |
December 31, 2019 |
February 21, 2020 |
||||||
Company’s stock price |
$ | $ | ||||||
Conversion price |
||||||||
Remaining term (years) |
||||||||
Equity volatility |
% | N/A | ||||||
Risk free rate |
% | N/A | ||||||
1 Probability of default event |
% | N/A | ||||||
1 Utilization of Forced Conversion (if available) |
% | % | ||||||
1 Exercise of Default Redemption (if available) |
% | N/A | ||||||
1 Effective discount rate |
% | N/A |
1 |
Represents a Level 3 unobservable input, as defined in Note 4 - Fair Value Measurements, below. |
Convertible Debentures |
December 31, 2019 |
February 21, 2020 |
||||||
Fair value, in accordance with fair value option |
$ | $ | ||||||
Principal value outstanding |
$ | $ | ||||||
Exhibit 4
DESCRIPTION OF SECURITIES
REGISTERED PURSUANT TO SECTION 12 OF THE
SECURITIES EXCHANGE ACT OF 1934
As of December 31, 2021, iCAD, Inc. (the Company, we, us or our) has one class of securities registered under Section 12 of the Securities Exchange Act of 1934, as amended: our common stock, par value $0.01 per share (Common Stock).
General
The following description of our capital stock and certain provisions of our certificate of incorporation, as amended (our Certificate of Incorporation) and by-laws, as amended (our Bylaws), are summaries, and are qualified in their entirety by reference to our Certificate of Incorporation and Bylaws. Copies of these documents can be accessed through hyperlinks to those documents in the list of exhibits in our Annual Report on Form 10-K for the fiscal year ending December 31, 2021 (our Annual Report). Capitalized terms used and not defined herein have the meanings ascribed to such terms in the Annual Report.
Our authorized capital stock consists of 60,000,000 shares of Common Stock, and 1,000,000 shares of blank check preferred stock.
Common Stock
The rights, preferences and privileges of the holders of Common Stock are subject to, and may be adversely affected by, the rights of the holders of shares of any then outstanding preferred stock.
Voting Rights
Each share of Common Stock is entitled to one vote on all matters to be voted on by stockholders. There are no cumulative voting rights in the election of directors, minority stockholders will not be able to elect directors on the basis of their votes alone.
Dividend Rights
The holders of Common Stock are entitled to receive dividends when, as and if declared by our Board of Directors out of funds legally available therefor.
No Preemptive or Similar Rights
Holders of shares of Common Stock have no conversion, preemptive or other subscription rights, and there are no redemption provisions applicable to the Common Stock. All outstanding shares of Common Stock are fully paid and nonassessable.
Right to Liquidation Distributions
In the event of liquidation, dissolution or winding up of our Company, the holders of Common Stock are entitled to share in all assets remaining, if any, which are available for distribution to them after payment of liabilities and after provision has been made for each class of stock, if any, having preference over the Common Stock.
Limitations on Liability and Indemnification of Officers and Directors
Section 102 of the DGCL allows a corporation to eliminate the personal liability of directors of a corporation to the corporation or its stockholders for monetary damages for a breach of fiduciary duty as a director, except where the director breached his duty of loyalty, failed to act in good faith, engaged in intentional misconduct or knowingly violated a law, authorized the payment of a dividend or approved a stock repurchase in violation of Delaware law or obtained an improper personal benefit.
Section 145 of the DGCL provides, among other things, that a corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding (other than an action by or in the right of the corporation) by reason of the fact that the person is or was a director, officer, agent or employee of the corporation or is or was serving at the corporations request as a director, officer, agent, or employee of another corporation, partnership, joint venture, trust or other enterprise, against expenses, including attorneys fees, judgment, fines and amounts paid in settlement actually and reasonably incurred by the person in connection with such action, suit or proceeding. The power to indemnify applies (a) if such person is successful on the merits or otherwise in defense of any action, suit or proceeding or (b) if such person acted in good faith and in a manner he reasonably believed to be in the best interest, or not opposed to the best interest, of the corporation, and with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. The power to indemnify applies to actions brought by or in the right of the corporation as well, but only to the extent of defense expenses (including attorneys fees but excluding amounts paid in settlement) actually and reasonably incurred and not to any satisfaction of judgment or settlement of the claim itself, and with the further limitation that in such actions no indemnification shall be made in the event of any adjudication of negligence or misconduct in the performance of duties to the corporation, unless the court believes that in light of all the circumstances indemnification should apply.
We have entered into indemnification agreements with each of our directors and officers. Generally, these agreements attempt to provide the maximum protection permitted by Delaware law with respect of indemnification. The indemnification agreements provided that we will pay certain amounts incurred in connection with any action, suit, investigation or proceeding arising out of or relating to the performance of services by the director or officer, or by acting as a director, officer or employee.
Liability Insurance.
We have obtained directors and officers liability insurance which covers certain liabilities, including liabilities to us and our stockholders.
Certificate of Incorporation
The Certificate of Incorporation eliminates, to the fullest extent permitted by the DGCL, a directors personal liability to the Company or its stockholders for monetary damages for breach of fiduciary duty as a director.
Bylaws
The Bylaws provide that the Company will indemnify its officers and directors to the full extent permitted by the laws of the State of Delaware and the employment agreements with the Companys executive officers and indemnification agreements between the Company and its directors and certain of its officers provide that the Company will indemnify them to the full extent provided by the DGCL.
Anti-Takeover Provisions
Our Certificate of Incorporation authorizes the Board of Directors to issue up to 1,000,000 shares of preferred stock. The preferred stock may be issued in one or more series, the terms of which may be determined at the time of issuance by our Board of Directors, without further action by stockholders, and may include, among other things, voting rights (including the right to vote as a series on particular matters), preferences as to dividends and liquidation, conversion and redemption rights, and sinking fund provisions. Although there are currently no shares of preferred stock outstanding, future holders of preferred stock may have rights superior to our Common Stock and such rights could also be used to restrict our ability to merge with, or sell our assets to a third party.
Section 203 of the DGCL
We are also subject to the provisions of Section 203 of the DGCL, which could prevent us from engaging in a business combination with a 15% or greater stockholder for a period of three years from the date such person acquired that status unless appropriate board or stockholder approvals are obtained. These provisions could deter unsolicited takeovers or delay or prevent changes in our control or management, including transactions in which stockholders might otherwise receive a premium for their shares over the then current market price. These provisions may also limit the ability of stockholders to approve transactions that they may deem to be in their best interests.
The existence of the foregoing provisions of our certificate of incorporation and bylaws and the DGCL may have an anti-takeover effect and could delay, defer or prevent a tender offer or takeover attempt that a stockholder might consider in its best interest, including those attempts that might result in a premium over the market price for the shares of our Common Stock held by stockholders.
Transfer Agent
The transfer agent and registrar for the Common Stock is Continental Stock Transfer & Trust Company.
Listing
Our Common Stock is listed on The Nasdaq Stock Market under the symbol ICAD.
EXHIBIT 21
Subsidiaries of iCAD, Inc.
Name |
Jurisdiction of Incorporation/Organization | |
Xoft, Inc. | Delaware | |
Xoft Solutions, LLC | Delaware | |
iCad France, LLC | Delaware | |
iCad Italy, LLC | Delaware |
EXHIBIT 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
iCAD, Inc.
Nashua, New Hampshire
We hereby consent to the incorporation by reference in the Registration Statements on Form S-3 (No. 333-228514, 333-229452 and 333-235887) and Form S-8 (No. 333-201874, 333-187660, 333-99973, 333-119509, 333-139023, 333-144671, 333-161959, 333-211656, 333-229453 and 333-235580) and Form S-3MEF (No. 333-253808) of iCAD, Inc. and subsidiaries of our report dated March 28, 2022, relating to the consolidated financial statements which appear in this Annual Report on Form 10-K.
/s/ BDO USA, LLP
Boston, Massachusetts
March 28, 2022
EXHIBIT 31.1
CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER
I, Stacey Stevens, certify that:
1. I have reviewed this Annual Report on Form 10-K for the fiscal year ended December 31, 2021 of iCAD, Inc.;
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 registrants other certifying officer(s) 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 registrants 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 registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting.
5. The registrants other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants 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 registrants 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 registrants internal control over financial reporting.
Date: March 28, 2022 | /s/ Stacey Stevens | |||||
Stacey Stevens | ||||||
Chief Executive Officer | ||||||
(Principal Executive Officer) |
EXHIBIT 31.2
CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER
I, Charles Carter, certify that:
1. I have reviewed this Annual Report on Form 10-K for the fiscal year ended December 31, 2021 of iCAD, Inc.;
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 registrants other certifying officer(s) 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 registrants 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 registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting.
5. The registrants other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrants auditors and the audit committee of the registrants 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 registrants 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 registrants internal control over financial reporting.
Date: March 28, 2022 | /s/ Charles Carter | |||||
Charles Carter | ||||||
Chief Financial Officer | ||||||
(Principal Financial Officer) |
EXHIBIT 32.1
iCAD, Inc.
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of iCAD, Inc. (the Company) on Form 10-K for the fiscal year ended December 31, 2021 (the Report), I, Stacey Stevens, the Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:
(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ Stacey Stevens |
Stacey Stevens |
Chief Executive Officer |
(Principal Executive Officer) |
Date: March 28, 2022
EXHIBIT 32.2
iCAD, Inc.
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report of iCAD, Inc. (the Company) on Form 10-K for the fiscal year ended December 31, 2021 (the Report), I, Charles Carter, the Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:
(1) | The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and |
(2) | The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ Charles Carter |
Charles Carter |
Chief Financial Officer |
(Principal Financial Officer) |
Date: March 28, 2022
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands |
Dec. 31, 2021 |
Dec. 31, 2020 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts on trade accounts receivable | $ 268 | $ 111 |
Intangible assets, accumulated amortization | $ 8,724 | $ 8,494 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 60,000,000 | 60,000,000 |
Common stock, shares issued | 25,326,086 | 23,694,406 |
Common stock, shares outstanding | 25,140,255 | 23,508,575 |
Treasury stock, shares | 185,831 | 185,831 |
Consolidated Statements of Stockholders' Equity (Parenthetical) - shares |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Common Stock [Member] | |||
Shares forfeited for tax obligations | 5,196 | 20,247 | 29,887 |
Additional Paid-in Capital [Member] | |||
Shares forfeited for tax obligations | 5,196 | 20,247 | 29,887 |
Organization and Business |
12 Months Ended |
---|---|
Dec. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Business | Note 1 – Organization and Business iCAD, Inc. and subsidiaries (the “Company” or “iCAD”) is a global medical technology company providing innovative cancer detection and therapy solutions. The Company operates in segments: Cancer Detection (“Detection”) and Cancer Therapy (“Therapy”). In the detection segment, offered solutions include advanced artificial intelligence and image analysis workflow solutions that enable healthcare professionals to better serve patients by identifying pathologies and pinpointing the most prevalent cancers earlier, a comprehensive range of high-performance, upgradeable computer-aided detection systems and workflow solutions for digital breast tomosynthesis, full-field digital mammography, magnetic resonance imaging and computed tomography. In the Therapy segment, the Company offers the Xoft System, which is a cancer treatment platform technology incorporating a miniaturized, isotope-free radiation source. The Company’s commercial products are cleared with the United States Food and Drug Administration and various global regulatory agencies and use of iCAD’s products are reimbursable in the U.S. under federal and most third-party insurance programs. The Company sells its products throughout the world through its direct sales organization as well as through various OEM partners, distributors, technology platform partners, and resellers. See Note 14 of these consolidated financial statements for segment, major customer and geographical information. The Company maintains its headquarters and a separate manufacturing facility in Nashua, New Hampshire, an operations, research, development, manufacturing and warehousing facility in San Jose, California, and an office in Lyon, France. |
Summary of Significant Accounting Policies |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Significant Accounting Policies | Note 2 – Significant Accounting Policies Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses during the reporting period and disclosure of contingent assets and liabilities at the date of the financial statements. Actual results could differ from those estimates. It is reasonably possible that changes may occur in the near term that would affect management’s estimates with respect to assets and liabilities. Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries: Xoft, Inc., Xoft Solutions, LLC, and iCAD France, LLC. All material inter-company transactions and balances have been eliminated in consolidation. Risk and Uncertainty On March 12, 2020, the World Health Organization declared COVID-19 to be a pandemic. In an effort to contain and mitigate the spread of the COVID-19 pandemic, the United States and most countries of the world have imposed some level of unprecedented restrictions on travel, and there have been business closures and a substantial reduction in economic activity in countries that have had significant outbreaks of COVID-19. As a provider of devices and services to the health care industry, the Company’s operations have been materially affected in all periods presented. Significant uncertainty remains as to the continuing impact of the COVID-19 pandemic on the Company’s operations and on the global economy. It is currently not possible to predict how long the pandemic will last or the time that it will take for economic activity to return to prior levels. The COVID-19 pandemic has resulted in significant financial market volatility and uncertainty. A continued or worsening level of market disruption and volatility seen since the start of the pandemic will have an adverse effect on the Company’s ability to access capital, on the Company’s business, results of the Company’s operations and financial condition, and on the market price of the Company’s common stock. The Company’s results for the years ended December 31, 2021 and 2020, as well as all quarterly results beginning with Q1 2020 through Q4 2021, reflect a negative impact from the COVID-19 pandemic, including but not limited to healthcare customers and potential customers providing additional focus on COVID-19; pandemic-related public health impacts, including significant shifts in workforce availability and priorities, on customer, supplier, and iCAD’s business processes; and effects on healthcare customers and potential customers of pandemic related supply chain issues. The Company’s quarterly results for the quarter ending March 31, 2022 , and possibly future quarters, could reflect a continued negative impact from the COVID-19 pandemic for similar or additional reasons. Although the Company did not see any material impact to trade accounts receivable losses in the year ended December 31, 2021, the Company’s exposure may increase if its customers are adversely affected by changes in healthcare laws, coverage, and reimbursement, economic pressures or uncertainty associated with local or global economic recessions, disruption associated with the current COVID-19 pandemic, or other customer-specific factors. The Company has historically not experienced significant trade account receivable losses, but it is possible that there could be a material adverse impact from potential adjustments of the carrying amount of trade account receivables as clinical customers’ cash flows are impacted by their response to the COVID-19 pandemic as well as public health considerations impacting their underlying businesses. Cash and cash equivalents The Company defines cash and cash equivalents as all bank accounts, money market funds, deposits and other money market instruments with original maturities of 90 days or less and which are unrestricted as to timing or method of withdrawal. Cash and cash equivalents are maintained at financial institutions and, at times, balances may exceed federally insured limits of $250,000 per depositor. Historically, the Company has not experienced any losses related to these balances Financial instruments Financial instruments consist of cash and cash equivalents, trade accounts receivable, contract assets, accounts payable, accrued and other expenses and notes payable. Due to their short-term nature and market rates of interest, the carrying amounts of the financial instruments approximated fair value as of December 31, 2021 and 2020. Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are customer obligations due under normal trade terms. Credit limits are initially established through a process of reviewing the financial history and stability of each customer and the Company performs continuing credit evaluations of its customers’ financial condition and generally does not require collateral. Included in accounts receivable at December 31, 2021 are unbilled receivables of approximately $0.4 million which are scheduled t o be invoiced in 2022. The Company’s policy is to maintain allowances for potential losses resulting from the inability of a portion of its customers to make required payments. The Company’s senior management reviews accounts receivable on a periodic basis to determine if any receivables may potentially be uncollectible. The Company includes any accounts receivable balances that it determines may likely be uncollectible, along with a general reserve for estimated probable losses based on historical experience, in its allowance for doubtful accounts. An amount is written off against the allowance after all attempts to collect the receivable have failed. Inventory The Company uses the first-in, first-out method to track inventory, which is valued at the lower of cost or net realizable value. The Company regularly reviews inventory quantities on hand and records an inventory reserve for excess and/or obsolete inventory primarily based upon the estimated usage of its inventory, as well as other factors. Property and Equipment Property and equipment are stated at cost and depreciated using the straight-line method over the estimated useful lives of the assets, which is generally to five years, except for leasehold improvements, which are depreciated over the shorter of the term of the lease, or useful life of the asset. Goodwill In accordance with FASB Accounting Standards Codification (“ASC”) Topic 350-20, “Intangibles—Goodwill and Other” 350-20”), the Company tests goodwill for impairment on an annual basis and between annual tests if events or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. Factors the Company considers important, which could trigger an impairment of Goodwill, include the following:
The two reporting units within iCAD are its segments, Detection and Therapy. The Company records an impairment charge if such an assessment were to indicate that the fair value of a reporting unit was less than the carrying value. When the Company evaluates potential impairments outside of its annual measurement date, judgment is required in determining whether an event has occurred that may impair the value of goodwill or intangible assets. Fair values for the reporting units are based on a weighting of the income approach and the market approach. For purposes of the income approach, fair value is determined based on the present value of estimated future cash flows, discounted at an appropriate risk adjusted rate. The Company uses internal forecasts to estimate future cash flows and includes estimates of long-term future growth rates based on our most recent views of the long-term forecast for each segment. Accordingly, actual results can differ from those assumed in our forecasts. Discount rates are derived from a capital asset pricing model and by analyzing published rates for industries relevant to our reporting units to estimate the cost of equity financing. The Company uses discount rates that are commensurate with the risks and uncertainty inherent in the respective businesses and in our internally developed forecasts. In the market approach, the Company uses a valuation technique in which values are derived based on market prices of publicly traded companies with similar operating characteristics and industries. A market approach allows for comparison to actual market transactions and multiples. It can be somewhat limited in its application because the population of potential comparable publicly-traded companies can be limited due to differing characteristics of the comparative business and ours, as well as the fact that market data may not be available for divisions within larger conglomerates or non-public subsidiaries that could otherwise qualify as comparable, and the specific circumstances surrounding a market transaction (e.g., synergies between the parties, terms and conditions of the transaction, etc.) may be different or irrelevant with respect to our business. The Company corroborates the total fair values of the reporting units using a market capitalization approach; however, this approach cannot be used to determine the fair value of each reporting unit value. The blend of the income approach and market approach is more closely aligned to our business profile, including markets served and products available. In addition, required rates of return, along with uncertainties inherent in the forecast of future cash flows, are reflected in the selection of the discount rate. Equally important, under the blended approach, reasonably likely scenarios and associated sensitivities can be developed for alternative future states that may not be reflected in an observable market price. The Company assesses each valuation methodology based upon the relevance and availability of the data at the time the valuation is performed and weights the methodologies appropriately. The Company performed the annual impairment assessment at October 1, 2021 and compared the fair value of each reporting unit to its carrying value as of this date. The fair value of the Detection reporting unit exceeded the carrying value. Accordingly, no impairment of goodwill was recorded. The carrying values of the reporting units were determined based on an allocation of our assets and liabilities through specific allocation of certain assets and liabilities, to the reporting units and an apportionment of the remaining net assets based on the relative size of the reporting units’ revenues and operating expenses compared to the Company as a whole. The determination of reporting units also requires management judgment. Long Lived Assets In accordance with FASB ASC Topic 360 , “Property, Plant an d Equipment” (“ASC 360 ”), the Company assesses long-lived assets for impairment if events and circumstances indicate it is more likely than not that the fair value of the asset group is less than the carrying value of the asset group. ASC 360 -10 -35 uses “events and circumstances” criteria to determine when, if at all, an asset (or asset group) is evaluated for recoverability. Thus, there is no set interval or frequency for recoverability evaluation. In accordance with ASC 360 -10 -35 -21 the following factors are examples of events or changes in circumstances that indicate t h e carrying amount of an asset (asset group) may not be recoverable and thus is to be evaluated for recoverability.
In accordance with ASC 360-10-35-17, The Company did not record any impairment charges on its long-lived assets for the years ended December 31, 2021 or December 31, 2020. Intangible assets subject to amortization consist primarily of patents, technology intangibles, trade names, customer relationships and distribution agreements purchased in the Company’s previous acquisitions. These assets are amortized on a straight-line basis or the pattern of economic benefit over their estimated useful lives of 5 to 10 years. Leases Per ASC 842, the Company determines if an arrangement contains a lease at inception. A lease is an operating or financing contract, or part of a contract, that conveys the right to control the use of an identified tangible asset for a period of time in exchange for consideration. At lease inception, the Company recognizes a lease liability equal to the present value of the remaining lease payments, and a right of use asset equal to the lease liability, subject to certain adjustments, such as for lease incentives. In determining the present value of the lease payments, the Company uses its incremental borrowing rate, determined by estimating the Company’s applicable, fully collateralized borrowing rate, with adjustment as appropriate for lease term. The lease term at the lease commencement date is determined based on the non-cancellable period for which the Company has the right to use the underlying asset, together with any periods covered by an extension option if the Company is reasonably certain to exercise that option. Right-of-use non-lease components, but the Company is accounting for the complete agreement under ASC 606 after determining that the non-lease component is the predominant component of these agreements. ASC 842 includes a number of reassessment and re-measurement requirements for lessees based on certain triggering events or conditions. There were no impairment indicators identified during the year ended December 31, 2021 that would require impairment testing of the Company’s right-of-use Certain of the Company’s leases include variable lease costs to reimburse the lessor for real estate tax and insurance expenses, and certain non-lease components that transfer a distinct service to the Company, such as common area maintenance services. The Company has elected to separate the accounting for lease components and non-lease components for real estate and equipment leases. Stock-Based Compensation The Company maintains stock-based incentive plans, under which it provides stock incentives to employees, directors and contractors. The Company grants to employees, directors and contractors, options to purchase common stock at an exercise price equal to the market value of the stock at the date of grant. The Company may grant restricted stock to employees and directors. The underlying shares of the restricted stock grant are not issued until the shares vest, and compensation expense is based on the stock price of the shares at the time of grant. The Company follows ASC 718, “Compensation – Stock Compensation” re-measured at every reporting period. As a result, compensation cost could vary significantly during the performance measurement period.will retain their vested stock options before exercising them, the estimated volatility of its common stock price over the expected term, and the number of options that will be forfeited prior to the completion of their vesting requirements. The Company estimates forfeitures based on historical experience with pre-vested forfeitures. To the extent actual forfeitures differ from the estimate, the difference is recorded to compensation expense in the period of the forfeiture. Fair value of restricted stock is determined based on the stock price of the underlying option on the date of the grant. Application of alternative assumptions could produce significantly different estimates of the fair value of stock-based compensation and consequently, the related amounts recognized in the Consolidated Statements of Operations. Revenue Recognition In accordance with ASC 606, revenue is recognized when a customer obtains control of promised goods or services and the amount of revenue recognized reflects the consideration to which the Company expects to be entitled to receive in exchange for these goods or services and excludes any sales incentives or taxes collected from customers which are subsequently remitted to government authorities. The Company applies the following five steps to guide revenue recognition:
The Company recognizes revenue from its contracts with customers primarily from the sale of products and from the sale of services and supplies. Revenue is recognized when control of the promised goods or services is transferred to a customer, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. For iCAD’s typical product revenue, control typically transfers upon shipment as title and risk of loss have passed to the customer. Services and supplies are considered to be transferred as the services are performed or over the term of the service or supply agreement. The Company enters into contracts that can include various combinations of products and services, which are generally capable of being distinct and accounted for as separate performance obligations. Perpetual software license are accounted for as a single performance obligation and revenue is recognized at the point in time when ownership is transferred to the customer. Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by the Company from a customer, are excluded from revenue. Shipping and handling costs associated with outbound freight after control of a product has transferred to a customer are accounted for as fulfillment costs and are included in cost of revenue. The Company continues to provide for estimated warranty costs on original product warranties at the time of sale. Goods and Services Classifications Products . Product revenue consists of sales of cancer detection perpetual licenses, cancer therapy systems, cancer therapy applicators, cancer therapy disposable applicators and other accessories that are typically shipped with a cancer therapy system. The Company transfers control and recognizes a sale when the product is shipped from the manufacturing or warehousing facility to the customer. Service Contracts 12 months to 48 months. The Company typically receives payment at the inception of the contract and recognizes revenue on a straight-line basis over the term of the agreement. Supply and Source Usage Agreements . Revenue from supply and source usage agreements is recognized on a straight-line basis over the term of the supply or source agreement. Professional Services . Revenue from fixed fee service contracts is recognized on a straight-line basis over the term of the agreement. Revenue from professional service contracts entered into with customers on a time and materials basis is recognized over the term of the agreement in proportion to the costs incurred in satisfying the obligations under the contract. Other . Other revenue consists primarily of miscellaneous products and services. The Company transfers control and recognizes a sale when the installation services are performed or when the Company ships the product from the Company’s manufacturing or warehouse facility to the customer. Significant Judgments The Company’s contracts with customers may include promises to transfer multiple products and services to a customer and identifying distinct performance obligations that should be accounted for separately versus together may require significant judgment. For arrangements with multiple performance obligations, the Company allocates revenue to each performance obligation based on its relative standalone selling price. Judgment is required to determine the standalone selling price for each distinct performance obligation. The Company generally determines standalone selling prices based on the prices charged to customers and uses a range of amounts to estimate standalone selling prices when the Company sells each of the products and services separately and need to determine whether there is a discount that needs to be allocated based on the relative standalone selling prices of the various products and services. The Company typically has more than one range of standalone selling prices for individual products and services due to the stratification of those products and services by customers and circumstances. In these instances, the Company may use information such as the type of customer and geographic region in determining the range of standalone selling prices. The Company may provide credits or incentives to customers, which are accounted for as variable consideration when estimating the transaction price of the contract and amounts of revenue to recognize. The amount of variable consideration to include in the transaction price is estimated at contract inception using either the estimated value method or the most likely amount method based on the nature of the variable consideration. These estimates are updated at the end of each reporting period as additional information becomes available and revenue is recognized only to the extent that it is probable that a significant reversal of any amounts of variable consideration included in the transaction price will not occur. The Company provides for estimated warranty costs on original product warranties at the time of sale. Assets Recognized from the Costs to Obtain a Contract with a Customer The Company recognizes incremental costs of obtaining a contract with a customer as an asset if the Company expects the benefit of those costs to be longer than one year and as an expense when incurred if the amortization period of the asset that the Company otherwise would have recognized is one year or less. Right to Invoice Where applicable, the Company recognizes revenue from a contract with a customer in an amount that corresponds directly with the value to the customer of the Company’s performance completed to date and the amount to which the Company has a right to invoice. Sales and Other Similar Taxes The Company excludes sales taxes and similar taxes from the measurement of transaction price and ensures compliance w ith Significant Financing Component The Company does not adjust the promised amount of consideration for the effects of a significant financing component if the Company expects, at contract inception, that the period between when the entity transfers a promised good or service to a customer and when the customer pays for that good or service will be one year or less. Promised Goods or Services that are Immaterial in the Context of a Contract The Company assesses materiality of promised goods or services as performance obligations in the context of a contract and the Company does not aggregate and assess immaterial items at the entity level. When determining whether a good or service is immaterial in the context of a contract, the assessment will be made based on the application of ASC 606 at the contract level. The Company does not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which it recognizes revenue at the amount to which it has the right to invoice for services performed. Cost of Revenue Cost of revenue consists of the costs of products purchased for resale, cost relating to service including costs of service contracts to maintain equipment after the warranty period, inbound freight and duty, manufacturing, warehousing, material movement, inspection, scrap, rework, depreciation and in-house product warranty repairs, amortization of acquired technology and any applicable medical device tax. Warranty Costs The Company provides for the estimated cost of standard product warranty against defects in material and workmanship based on historical warranty trends, including the cost of product returns during the warranty period. Warranty costs have not historically been material to the Company’s consolidated financial statements. Engineering and Product Development Costs Engineering and product development costs relate to research and development efforts including Company sponsored clinical trials are expensed as incurred. Advertising Costs The Company expenses advertising costs as incurred. Advertising expense for the years ended December 31, 2021, 2020 and 2019 was approximately $689,000, $274,000, and $1,101,000, respectively. Income Taxes The Company follows the liability method under ASC Topic 740 “
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Recently Issued Accounting Standards |
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Accounting Standards Update and Change in Accounting Principle [Abstract] | |
Recently Issued Accounting Standards | Note 3 – Recently Issued Accounting Standards In June 2016, the Financial Accounting Standards Board (the “FASB”) issued ASU 2016-13, “Financial Instruments—Credit Losses (Topic 326)” (“ASU 2016-13”), which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. ASU 2016-13 replaces the existing incurred loss impairment model with an expected loss model which requires the use of forward-looking information to calculate credit loss estimates. These changes will result in earlier recognition of credit losses. In November 2019, the FASB elected to defer the adoption date of ASU 2016-13 for public business entities that meet the definition of a smaller reporting company to fiscal years beginning after December 15, 2022. Early adoption of the guidance in ASU 2016-13 is permitted. The Company is currently evaluating the impact that the adoption of ASU 2016-13 will have on its consolidated financial statements. In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes” (“ASU 2019-12”). ASU 2019-12 is intended to simplify the accounting for income taxes by removing certain exceptions to the general principles in Topic 740. The amendments also improve consistent application of and simplify US GAAP for other areas of Topic 740 by clarifying and amending existing guidance. ASU 2019-12 is effective for the Company for the fiscal year and interim periods therein beginning January 1, 2021. The Company notes that the adoption of ASU 2019-12 resulted in the reclassification of an immaterial amount from income tax expense to non-income tax included in operating expenses related to the accounting for state and franchise taxes, with no impact to the Company’s consolidated loss, equity or cash flows. |
Fair Value Measurements |
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Fair Value Measurements | Note 4 – Fair Value Measurements The Company follows the provisions of FASB ASC Topic 820, “ Fair Value Measurement and Disclosures
The assigned level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Money market funds included in cash and cash equivalents in the accompanying balance sheet are considered a Level 1 measurement as they are valued at quoted market prices in active markets. The following table sets forth the Company’s assets which are measured at fair value on a recurring basis by level within the fair value hierarchy (in thousand):
The following is a roll forward of the Company’s Level 3 instruments for the years ended December 31, 2021 and 2020:
There were no Level 3 instruments measured at fair value at December 31, 2021 or December 31, 2020. Items Measured at Fair Value on a Nonrecurring Basis Certain assets, including long-lived assets and goodwill, are measured at fair value on a nonrecurring basis. These assets are recognized at fair value when they are deemed to be impaired. There were no items measured at fair value on a nonrecurring basis as of or during the years ended December 31, 2021 and 2020. |
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Revenue | Note 5 – Revenue Disaggregation of Revenue The following tables presents the Company’s revenues disaggregated by major good or service line, timing of revenue recognition and sales channel, reconciled to its reportable segments (in thousands).
Contract Balances Contract liabilities are a component of deferred revenue, current contract assets are a component of prepaid and other assets and non-current contract assets are a component of other assets. The following table provides information about receivables, current and non-current contract assets, and contract liabilities from contracts with customers (in thousands).
The Company records a receivable when revenue is recognized prior to receipt of cash payments and the Company has the unconditional right to such consideration, or unearned revenue when cash payments are received or due in advance of performance. For multi-year agreements, the Company generally invoices customers annually at the beginning of each annual service period. The Company records net contract assets or contract liabilities on a contract-by-contract non-current based on the expected timing of the Company’s right to bill under the terms of the contract. The current contract asset balance primarily relates to the net unbilled revenue balances with two significant customers, which the Company expects to be able to bill for within one year. The non-current contract asset balance consists of net unbilled revenue balances with two customers which the Company expects to be able to bill for in more than one year. Contract liabilities, or deferred revenue from contracts with customers, is primarily composed of fees related to long-term service arrangements, which are generally billed in advance. Deferred revenue also includes payments for installation and training that has not yet been completed and other offerings for which the Company has been paid in advance and earn the revenue when it transfers control of the product or service. Changes in deferred revenue from contracts with customers were as follows (in thousands):
The Company expects to recognize estimated revenues related to performance obligation that are unsatisfied (or partially satisfied) in the amounts of approximately $7.1 million in 2022, $1.2 million in 2023, $1.0 million in 2024, and $1.0 million in 2025. Assets Recognized from the Costs to Obtain a Contract with a Customer The Company recognizes an asset for the incremental costs of obtaining a contract with a customer if it expects the benefit of those costs to be longer than one year. Certain commission programs implemented by the Company require costs to be capitalized. The Company has classified the capitalized costs to obtain a contract as a component of prepaid expenses and other current assets as of December 31, 2021 and 2020, respectively. Changes in the balance of capitalized costs to obtain a contract were as follows (in thousands):
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Net Loss per Common Share (1o) |
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Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Loss per Common Share (1o) | Note 6 – Net Loss per Common Share (1o) The Company follows FASB ASC 260-10, “Earnings per Share”, which requires the presentation of both basic and diluted earnings per share on the face of the statements of operations. The Company’s basic net loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding for the period and, if there are dilutive securities, diluted income per share is computed by including common stock equivalents which includes shares issuable upon the exercise of stock options, net of shares assumed to have been purchased with the proceeds, using the treasury stock method. A summary of the Company’s calculation of net loss per share is as follows (in thousands, except per share amounts):
The following table summarizes the number of shares of common stock for convertible securities, warrants and restricted stock that were not included in the calculation of diluted net loss per share because such shares are antidilutive:
Restricted common stock can be issued to directors, executives or employees of the Company and are subject to time-based vesting. These potential shares were excluded from the computation of basic loss per share as these shares are not considered outstanding until vested. |
Allowance for Doubtful Accounts |
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Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Allowance for Doubtful Accounts | Note 7 – Allowance for Doubtful Accounts The rollforward of the Company’s allowance for doubtful accounts for the years ended December 31 is as follows (in thousands):
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Inventories |
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Inventory Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventories | Note 8 – Inventories Inventory balances at December 31, 2021 and 2020 were as follows (in thousands):
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Goodwill and Intangible assets |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible assets | Note 9 – Goodwill and Intangible assets At December 31, 2021 and 2020, all of the Company’s goodwill of $8,362,000 is allocated to its Detection reporting. There were no additions, impairments or other changes to the Company’s goodwill balance for either of the years ended December 31, 2021 or 2020. Amortization expense related to intangible assets was approximately $230,000, $309,000 and $377,000 for the years ended December 31, 2021, 2020, and 2019, respectively.
Estimated remaining amortization of the Company’s intangible assets is as follows (in thousands):
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Accrued and Other Expenses |
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Accrued and Other Expenses | Note 10 – Accrued and Other expenses Accrued and other expenses consist of the following at December 31 (in thousands):
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Leases |
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Leases | Note 11 – Leases The Company has leases for office space and office equipment. The leases expire at various dates through 2024. In connection with the 2019 lease amendment for the Nashua headquarters, the Company was eligible for $110,160 of lease incentives. During 2021 the leasehold improvements were completed and the Company received the related lease incentives in cash resulting in an increase to the lease payable. In October 2021, the Company extended the term of its Nashua warehouse until 2024. This resulted in an increase of approximately $79,000 to the Company’s right of use asset and related lease liability.
Maturities of the Company’s lease liabilities as of December 31, 2021 were as follows (in thousands):
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Stockholders' Equity |
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Stockholders' Equity | Note 12 – Stockholders’ Equity (a) Financing Activity On April 27, 2020, the Company issued 1,562,500 shares of common stock to several institutional investors at a price of $8.00 per share in a registered direct offering. The gross proceeds of the offering were approximately $12.5 million, and the Company received net proceeds of approximately $12.3 million. The Company also entered into an at-the-market d for the sale of common stock having a value of up to $25.0 million. On December 17, 2020 the company sold 470,704 shares of common stock under the ATM facility. The gross proceeds were approximately $6.6 million, and the Company received net proceeds of approximately $6.1 million which is net of brokerage fees and offering costs to open the ATM. On March 2, 2021, the Company terminated the ATM offering program with JMP Securities On March 2, 2021, the Company entered into an underwriting agreement (the “Underwriting Agreement”) with Guggenheim Securities, LLC, as representative of the several underwriters (the “Underwriters”), in connection with an underwritten public offering of 1,393,738 shares of the Company’s common stock, at a public offering price of $18.00 per share (the “Offering”). The Underwriting Agreement contained customary representations, warranties and covenants by the Company, indemnification obligations of the Company and the Underwriters, including for liabilities under the Securities Act, other obligations of the parties and termination provisions. In exchange for the Underwriters’ services, the Company agreed to sell the shares to the Underwriters at a purchase price of $16.92 per share and to reimburse the representative of the Underwriters for up to $125,000 of its expenses in connection with the Offering. The Offering closed March 5, 2021. The net proceeds to the Company from the Offering were approximately $23.2 million, after deducting underwriting discounts and commissions and estimated offering expenses payable by the Company. (b) Stock Options The Company has two effective stock option or stock incentive plans, the 2012 Stock Incentive Plan (the “2012 Plan”) and the 2016 Stock Incentive Plan (the “2016 Plan”) (collectively the “Stock Plans”). Each of the Stock Plans provide for the grant of any or all of the following types of awards: (a) stock options, (b) restricted stock, (c) deferred stock and (d) other stock-based awards. Awards may be granted singly, in combination, or in tandem. All awards granted under the Stock Plans are required to be granted at not less than 100% of the fair market value of the related award on the respective grant date. Awards under the Stock Plans may be granted to employees, directors and advisors to the Company and its subsidiaries. At December 31, 2021, there were 37,871 shares available for issuance under the 2012 Plan. At the Company’s 2021 annual meeting, the 2016 Plan was amended to increase the number of shares of common stock available thereunder from 2,600,000 to 4,700,000. At December 31 , 2021 , there were 1,718,200 shares available for issuance under the 2016 Plan.
The Company’s stock-based compensation expense, including options and restricted stock by category is as follows (amounts in thousands):
As of December 31, 2021, there was approximately $4.3 million of total unrecognized compensation costs related to unvested options and restricted stock. That cost is expected to be recognized over a weighted average period of 1.7 years. Options granted under the stock incentive plans were valued utilizing the Black-Scholes model using the following assumptions and had the following fair values:
The Company’s 2021, 2020 and 2019 average expected volatility and average expected life is based on the Company’s historical information. The risk-free rate is based on the rate of U.S. Treasury zero-coupon issues with a term most closely approximating the expected life of option grants. The Company has paid no dividends on its common stock in the past and does not anticipate paying any dividends in the future. Intrinsic values of options (in thousands) and the closing market price used to determine the intrinsic values are as follows: Intrinsic value of stock options
(c) Restricted Stock The Company’s restricted stock awards typically vest in either one year or three equal annual installments with the first installment vesting one year from grant date. All of the Company’s restricted stock grants in 2021 and 2019 had time-based vesting requirements. The grant date fair value for restricted stock awards is based on the quoted market value of Company stock on the grant date. A summary of unvested restricted stock activity for the Stock Plans is follows:
(d) Employee Stock Purchase Program: In December 2019, the Company’s Board of Directors adopted, and the stockholders approved the 2019 Employee Stock Purchase Plan (“ESPP”), effective January 1, 2020. The ESPP provides for the issuance of up 950,000 shares of common stock, subject to adjustment in the event of a stock split, stock dividend or other change in the Company’s capitalization. The ESPP may be terminated or amended by the Board of Directors at any time. Certain amendments to the ESPP require stockholder approval. Substantially all of the Company’s employees whose customary employment is for more than 20 hours a week are eligible to participate in the ESPP. Any employee who owns 5% or more of the voting power or value of the Company’s shares of common stock is ineligible to participate in the ESPP. Any eligible employee can enroll in the Plan as of the beginning of a respective quarterly accumulation period. Employees who participate in the ESPP may purchase shares by authorizing payroll deductions of up to 15% of their base compensation during an accumulation period. Unless the participating employee withdraws from participation, accumulated payroll deductions are used to purchase shares of common stock on the last business day of the accumulation period (the “Purchase Date”) at a price equal to 85% of the lower of the fair market value on (i) the Purchase Date or (ii) the first day of such accumulation period. Under applicable tax rules, no employee may purchase more than $25,000 worth of common stock, valued at the start of the purchase period, under the ESPP in any calendar year. The Company issued 24,786 and 42,606 shares of common stock under the ESPP for the years ended December 31, 2021 and 2020, respectively. 882,608 shares of Company common stock are reserved for issuance under the ESPP as of December 31, 2021. |
Income Taxes |
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Income Tax Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Taxes | Note 13 – Income Taxes Income Taxes The components of income tax expense for the years ended December 31 are as follows (in thousands):
The Company adopted ASU 2019-12 as of January 1, 2021. In accordance with this standard non-income and state franchise taxes are now classified as a component of operating expenses in General and Administrative expense. Income based tax expense will continue to be recognized as tax expense in the Consolidated Financial Statements. Tax expense for the year ended December 31, 2020 represents non-income and state franchise tax, however, the expense was not reclassified to operating expenses in accordance with ASU 2019-12. A summary of the differences between the Company’s effective income tax rate and the Federal statutory income tax rate for the years ended December 31 is as follows:
Deferred tax assets and liabilities are recognized for the expected future tax consequences of net operating loss carryforwards, tax credit carryforwards and temporary differences between the financial statement carrying amounts and the income tax basis of assets and liabilities. A valuation allowance is applied against any net deferred tax asset if, based on the available evidence, it is more likely than not that the deferred tax assets will not be realized. Deferred income taxes reflect the impact of “temporary differences” between the amount of assets and liabilities for financial reporting purposes and such amounts as measured by tax laws and regulations. The Company has fully reserved the net deferred tax assets, as it is more likely than not that the deferred tax assets will not be utilized. Deferred tax assets (liabilities) are composed of the following at December 31, 2021 and 2020 (in thousands):
The increase in the net deferred tax assets and corresponding valuation allowance during the year ended December 31, 2021 and December 31, 2020 is primarily attributable to net operating losses and research and development credits. As of December 31, 2021, the Company has federal net operating loss carryforwards totaling approximately $159.0 million. Federal net operating loss carryforwards totaling $120.1 million will expire at various dates from 2022 and 2037. The remaining $39.0 million of the federal net operating losses generated since December 31, 2017 can be carried forward indefinitely. As of December 31, 2021, the Company has provided a valuation allowance for its net operating loss carryforwards due to the uncertainty of the Company’s ability to generate sufficient taxable income in future years to obtain the benefit from the utilization of the net operating loss carryforwards. In the event of a deemed change in control, an annual limitation imposed on the utilization of the net operating losses may result in the expiration of all or a portion of the net operating loss carryforwards. There were no net operating losses utilized for the years ended December 31, 2021, 2020, or 2019. The Company currently has approximately $5.2 million in net operating losses that are subject to limitations related to Xoft. Approximately $656,000 can be used annually through 2029. The Company has available tax credit carryforwards (adjusted to reflect provisions of the Tax Reform Act of 1986) to offset future income tax liabilities totaling approximately $4.2 million. The credits expire in various years through 2041. The Company has additional tax credits of $1.8 million related to Xoft which have been fully reserved for and as a result no deferred tax asset has been recorded. These credits expire in various years through 2030. ASC 740-10 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return and also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. As of December 31, 2021 and 2020, the Company had no unrecognized tax benefits and no adjustments to liabilities or operations were required under ASC 740-10. The Company’s practice is to recognize interest and penalty expenses related to uncertain tax positions in income tax expense, which was zero for the yearsended December 31, 2021, 2020 and 2019. The Company files United States federal and various state income tax returns. The Company also files tax returns in France. Generally, the Company’s preceding tax years remain subject to examination by federal and state taxing authorities. The Company is not under examination by any other federal or state jurisdiction for any tax year. The Company does not anticipate that it is reasonably possible that unrecognized tax benefits as of December 31, 2021 will significantly change within the next 12 months. |
Segment Reporting |
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Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting | Note 14 – Segment Reporting (a) Segment Reporting Operating segments are the components of our business for which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. Our chief operating decision maker is our chief executive officer. Our operating segments are generally organized by the type of product or service offered and by geography. Each reportable segment generates revenue from the sale of medical equipment and related services and/or sale of supplies. The Company has determined there are two segments: Detection and Therapy. The Detection segment consists of the Company’s advanced image analysis and workflow products, and the Therapy segment consists of the Company’s radiation therapy products, and related services. The primary factors used by the Company’s CODM to allocate resources are based on revenues, gross profit, operating income or loss, and earnings or loss before interest, taxes, depreciation, amortization, and other specific and non-recurring items of each segment. Included in segment operating income are stock compensation, amortization of technology and depreciation expense. There are no intersegment revenues. The Company does not track its assets by operating segment and the CODM does not use asset information by segment to allocate resources or make operating decisions. Segment revenues, gross profit, segment operating income or loss, and a reconciliation of segment operating income or loss to GAAP loss before income tax is as follows (in thousands):
Segment depreciation and amortization included in segment operating income (loss) is as follows (in thousands):
(b) Geographic Information The Company’s sales are made to customers, distributors and dealers of mammography, electronic brachytherapy equipment and other medical equipment, and to foreign distributors of mammography and electronic brachytherapy equipment. Export revenue to a single country did not exceed 10% of total revenue in any year. Total export revenues were approximately $7.5 million or 22% of total revenue in 2021, $6.1 million or 20% of total revenue in 2020, and $3.8 million or 12% of total revenue in 2019. As of December 31, 2021 and 2020, the Company had outstanding receivables of $3.3 million and $3.4 million, respectively, from distributors and customers of its products who are located outside of the U.S.
Significant export sales in Europe are as follows:
(c) Major Customers The Company had one major OEM customer, GE Healthcare, with revenues of approximately $4.8 million in 2021, $5.0 million in 2020 and $7.6 million in 2019 or 14%, 17% and 24% of total revenue, respectively. Cancer detection products are also sold through OEM partners, including GE Healthcare, Fujifilm Medical Systems, Siemens Medical, and Vital Images. For the year ended December 31, 2021, these four OEM partners composed approximately 29% of Detection revenues and 19% of total revenue. Detection OEM partners in total composed approximately 40% of Detection revenue and 26% of total revenue for the year ended December 31, 202 1 , 37% of Detection revenue and 28% of total revenue for the year ended December 31, 2020 and 46% of Detection revenue and 33% of total revenue for the year ended December 31, 2019. The Company also had one major direct customer with revenues of approximately $.8 million, or 2% of total revenue for year ended December 31, 2021. OEM partners represented $5.5 million or 60% of outstanding receivables as of December 31, 2021, with GE Healthcare accounting for $.7 million or 8% of this amount. The four largest Therapy customers composed 2.8 million or 31% of outstanding receivables as of December 31, 2021. The largest Detection direct customer represents $.3 million or 3% of outstanding receivables as of December 31, 2021. These customers in total represented $8.6 million or 94% of outstanding receivables as of December 31, 2021. |
Commitments and Contingencies |
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Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 15 – Commitments and Contingencies (a) Purchase Commitments The Company has non-cancelable purchase orders with key suppliers executed in the normal course of business that total approximately $7.2 million. (b) Employment Agreements The Company has entered into employment agreements with certain key current and former executives. The employment agreements provide for minimum annual salaries and performance-based annual bonus compensation as defined in their respective agreements. In addition, the employment agreements provide that if employment is terminated without cause, the executive will receive an amount equal to their respective base salary then in effect for (i) fifteen months from the date of termination, for Mr. Klein, CEO, (ii) eighteen months from the date of termination, for Ms. Stevens, President, and (iii) twelve months from the date of termination, for Mr. Carter, CFO, and in each case, plus the pro rata portion of any annual bonus earned in any employment year through the date of termination. (c) Royalty Obligations In connection with prior litigation, the Company received a nonexclusive, irrevocable, perpetual, worldwide license, including the right to sublicense certain Hologic patents, and a non-compete covenant as well as an agreement not to seek further damages with respect to the alleged patent violations. In return, the Company had a remaining obligation to pay a minimum annual royalty payment of $250,000 payable through 2016. In addition to the minimum annual royalty payments, the litigation settlement agreement with Hologic also provides for payment of royalties if such royalties exceed the minimum payment based upon a specified percentage of future net sales on any products that practice the licensed rights. The estimated fair value of the patent license and non-compete covenant is $100,000 and was amortized over the useful life of approximately four years. In addition, a liability has been recorded within accrued expenses and accounts payable for future payment and for minimum royalty obligations totaling $0.2 million. (d) Legal Matters In December 2016, the Company entered into an Asset Purchase Agreement with Invivo Corporation (the “Asset Purchase Agreement”). In accordance with the Asset Purchase Agreement, the Company sold to Invivo all right, title and interest to certain intellectual property relating to the Company’s VersaVue Software and DynaCAD product and related assets for $3.2 million. The Company closed the transaction on January 30, 2017 less a holdback reserve of $350,000 for net proceeds of approximately $2.9 million. On September 5, 2018, third-party Yeda Research and Development Company Ltd. (“Yeda”), filed a complaint (the “Complaint”) against the Company and Invivo in the United States District Court for the Southern District of New York, captioned Yeda Research and Development Company Ltd. v. iCAD, Inc. and Invivo Corporation, Case No. 1:18-cv-08083-GBD, related to the Company’s sale of the VersaVue software and DynaCAD product under the Asset Purchase Agreement. Yeda alleged, among other things, that the Company infringed upon Yeda’s source code, which was originally licensed to the Company, by using it in the products that the Company sold to Invivo and that it is entitled to damages that could include, among other things, profits relating to the sales of these products. On April 13, 2021, the Company and Yeda entered into a Settlement and Release Agreement (the “Settlement Agreement”) whereby the Company furnished to Yeda a one-time cash payment of $ 85,000 and received a full, non-conditional release from Yeda of any and all claims related to the Complaint and the subject of the Complaint. Neither the Company nor Invivo acknowledged any wrongdoing at any point in connection with the Complaint or the subject matter thereof. The Escrowed Amount was reserved, in part, to cover any legal expenses related to the Asset Purchase Agreement and the transactions contemplated therein. The remaining balance of the Escrowed Amount following such expenses is due and payable to the Company in accordance with the terms of the Asset Purchase Agreement. The Company and Invivo agreed that Invivo would pay $ 50,000 of the Escrowed Amount and the Company expensed approximately $ 93,000 in the second quarter of 2021. In addition to the foregoing, the Company may be a party to various legal proceedings and claims arising out of the ordinary course of its business. Although the final results of all such matters and claims cannot be predicted with certainty, the Company currently believes that there are no current proceedings or claims pending against it the ultimate resolution of which would have a material adverse effect on its financial condition or results of operations, other than as set forth above. However, should the Company fail to prevail in any legal matter or should several legal matters be resolved against the Company in the same reporting period, such matters could have a material adverse effect on the Company’s operating results and cash flows for that particular period. The Company may be party to certain actions that have been filed against the Company which are being vigorously defended. The Company has determined that potential losses in these matters are neither probable or reasonably possible at this time. In all cases, at each reporting period, the Company evaluates whether or not a potential loss amount or a potential range of loss is probable and reasonably estimable under ASC 450, “Contingencies.” Legal costs are expensed as incurred. |
Notes Payable |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Notes Payable | Note 16 – Notes Payable (a) Loan and Security Agreement – Western Alliance Bank On March 30, 2020, the Company entered into a Loan and Security Agreement (the “Loan Agreement”) with Western Alliance Bank (the “Bank”) that provided an initial term loan (“Term Loan”) facility of $7.0 million and a $5.0 million revolving line of credit. On April 27, 2021, the Company repaid its obligations in the aggregate amount of $7,354,283 under and terminated the Loan Agreement with the Bank, and its collateral securing the facility was released. The Company accounted for this repayment and retirement as an extinguishment of the Loan Agreement. (b) Loan and Security Agreement – Silicon Valley Bank On August 7, 2017, the Company entered into a Loan and Security Agreement, (as amended, the “SVB Loan Agreement”), with Silicon Valley Bank that provided an initial term loan facility of $6.0 million and a $4.0 million revolving line of credit. On March 30, 2020, the Company elected to repay all outstanding obligations (including accrued interest) and retire the SVB Loan Agreement. The Company accounted for this repayment and retirement as an extinguishment of the SVB Loan Agreement. In addition to the outstanding principal and accrued interest, the Company was required to pay the $ 510,000 final payment, a termination fee of $ 114,000 and other costs totaling $ 10,000. The Company also wrote off unamortized original closing costs as of the extinguishment date. In March 2020 the Company recorded a loss on extinguishment of approximately $ 341,000 related to the repayment and retirement of the SVB Loan Agreement. The loss on extinguishment was composed of approximately $ 185,000 for the unaccrued final payment, $ 114,000 termination fee, and $ 42,000 of unamortized and other closing costs. (c) Convertible Debentures On December 20, 2018, the Company entered into a Securities Purchase Agreement (the “SPA”) with certain institutional and accredited investors (the “Investors”), including, but not limited to, all directors and executive officers of the Company at the time, pursuant to which the Investors purchased unsecured subordinated convertible debentures (the “Convertible Debentures”) with an aggregate principal amount of approximately $7.0 million in a private placement. On February 21, 2020 (the “Conversion Date”), the conditions permitting a forced conversion were met, and the Company elected to exercise its forced conversion right under the terms of the Convertible Debentures. As a result of this election, all of the outstanding Convertible Debentures were converted, at a conversion price of $4.00 per share, into 1,742,500 shares of the Company’s common stock. In accordance with the make-whole provisions in the Convertible Debentures, the Company also issued an additional 76,966 shares of its common stock. The make-whole amount represented the total interest which would have accrued through the maturity date of the Convertible Debentures, less the amounts previously paid, totaling $697,000. The conversion prices related to the make-whole amount were dependent on whether the Investors were related parties or unrelated third parties. Accounting Considerations and Fair Value Measurements Related to the Convertible Debentures The Company had previously elected to make a one-time, irrevocable election to utilize the fair value option to account for the Convertible Debentures as a single hybrid instrument at its fair value, with changes in fair value from period to period being recorded either in current earnings, or as an element of other comprehensive income (loss), for the portion of the change in fair value determined to relate to the Company’s own credit risk. The Company believed that the election of the fair value option allowed for a more meaningful representation of the total fair value of its obligation under the Convertible Debentures and allowed for a better understanding of how changes in the external market environment and valuation assumptions impact such fair value. The Company utilized a Monte Carlo simulation model to estimate the fair value of the Convertible Debentures. The Company recorded a final adjustment to the Convertible Debentures based on their fair value on the Conversion Date, just prior to the forced conversion being completed. Given that the Company’s prior simulation model included the assumption that the Company would elect to force conversion in 100% of scenarios when the requirements were met, the final valuation was based on the actual results of the forced conversion. As such, the Company based the final fair value adjustment to the Convertible Debentures just prior to conversion on the number of shares of common stock that were issued to the Investors upon conversion and the fair value of the Company’s common stock as of the Conversion Date. Company notes that the key inputs to the simulation model that were utilized to estimate the fair value of the Convertible Debentures at each valuation date included:
The Company’s stock price is based on the closing stock price on the valuation date. The conversion price is based on the contractual conversion price included in the SPA. The remaining term was determined based on the remaining time period to maturity of the Convertible Debentures. The Company’s equity volatility estimate was based on the Company’s historical equity volatility, the Company’s implied and observed volatility of option pricing, and the historical equity and observed volatility of option pricing for a selection of comparable guideline public companies. The risk-free rate was determined based on U.S. Treasury securities with similar terms. The probability of the occurrence of a default event was based on Bloomberg’s one year estimate of default risk for the Company (extrapolated over the remaining term). The utilization of the Forced Conversion right and the default redemption right is based on management’s best estimate of both features being exercised upon the occurrence of the related contingent events. The effective discount rate utilized at the December 31, 2019 and February 21, 2020 valuation dates was solved for utilizing the simulation model based on the principal value of the Convertible Debentures, as the transaction was determined to represent an ‘arm’s length’ transaction. The effective discount was corroborated against market yield data which implied the Company’s credit rating, and this implied credit rating will be utilized to determine the changes in the effective discount rate at future valuation dates. The effective discount rate utilized at the December 31, 2019 valuation date was based on yields on CCC-rated debt instruments with terms equivalent to the remaining term of the Convertible Debentures. The credit rating estimate was based on the implied credit rating determined at issuance and no changes were identified by the Company that would impact this assessment. The fair value and principal value of the Convertible Debentures as of December 31, 2019 and the Conversion Date was as follows (in thousands):
The Company recorded a loss from the change in fair value of the Convertible Debentures of approximately $7.5 million for the year ending December 31 , 2020 . Upon the consummation of the forced conversion, the Company issued 1,816,466 shares of common stock with a fair value of approximately $21.2 million, which was reclassified to stockholders’ equity. |
Employee Benefit Plan |
12 Months Ended |
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Dec. 31, 2021 | |
Employee Benefit Plan [Abstract] | |
Employee Benefit Plan | Note 17 – Employee Benefit Plan The Company has a 401(k) retirement plan (the “401(k) Plan”) for the benefit of eligible employees, as defined. Each participant may elect to contribute up to 90% of his or her compensation to the 401(k) Plan each year, subject to certain Internal Revenue Service limitations. The Company makes a safe harbor matching contribution of 100% of every dollar contributed, not to exceed 3% of participants’ eligible wages. The Company contributed approximately $.5 million during each of the years ended December 31, 2021 and 2020, respectively. |
Subsequent Events |
12 Months Ended |
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Dec. 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 18 – Subsequent Events The Company has evaluated events and transactions subsequent to the balance sheet date to the date of filing and is not aware of any events or transactions that occurred subsequent to the balance sheet date that would require recognition or disclosure in the consolidated financial statements. |
Summary of Significant Accounting Policies (Policies) |
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Segment Reporting [Abstract] | |||||||||||||||||||||
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses during the reporting period and disclosure of contingent assets and liabilities at the date of the financial statements. Actual results could differ from those estimates. It is reasonably possible that changes may occur in the near term that would affect management’s estimates with respect to assets and liabilities. |
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Risk and Uncertainty | Risk and Uncertainty On March 12, 2020, the World Health Organization declared COVID-19 to be a pandemic. In an effort to contain and mitigate the spread of the COVID-19 pandemic, the United States and most countries of the world have imposed some level of unprecedented restrictions on travel, and there have been business closures and a substantial reduction in economic activity in countries that have had significant outbreaks of COVID-19. As a provider of devices and services to the health care industry, the Company’s operations have been materially affected in all periods presented. Significant uncertainty remains as to the continuing impact of the COVID-19 pandemic on the Company’s operations and on the global economy. It is currently not possible to predict how long the pandemic will last or the time that it will take for economic activity to return to prior levels. The COVID-19 pandemic has resulted in significant financial market volatility and uncertainty. A continued or worsening level of market disruption and volatility seen since the start of the pandemic will have an adverse effect on the Company’s ability to access capital, on the Company’s business, results of the Company’s operations and financial condition, and on the market price of the Company’s common stock. The Company’s results for the years ended December 31, 2021 and 2020, as well as all quarterly results beginning with Q1 2020 through Q4 2021, reflect a negative impact from the COVID-19 pandemic, including but not limited to healthcare customers and potential customers providing additional focus on COVID-19; pandemic-related public health impacts, including significant shifts in workforce availability and priorities, on customer, supplier, and iCAD’s business processes; and effects on healthcare customers and potential customers of pandemic related supply chain issues. The Company’s quarterly results for the quarter ending March 31, 2022 , and possibly future quarters, could reflect a continued negative impact from the COVID-19 pandemic for similar or additional reasons. Although the Company did not see any material impact to trade accounts receivable losses in the year ended December 31, 2021, the Company’s exposure may increase if its customers are adversely affected by changes in healthcare laws, coverage, and reimbursement, economic pressures or uncertainty associated with local or global economic recessions, disruption associated with the current
COVID-19 pandemic, or other customer-specific factors. The Company has historically not experienced significant trade account receivable losses, but it is possible that there could be a material adverse impact from potential adjustments of the carrying amount of trade account receivables as clinical customers’ cash flows are impacted by their response to the COVID-19 pandemic as well as public health considerations impacting their underlying businesses. |
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Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries: Xoft, Inc., Xoft Solutions, LLC, and iCAD France, LLC. All material inter-company transactions and balances have been eliminated in consolidation. |
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Cash and cash equivalents | Cash and cash equivalents The Company defines cash and cash equivalents as all bank accounts, money market funds, deposits and other money market instruments with original maturities of 90 days or less and which are unrestricted as to timing or method of withdrawal. Cash and cash equivalents are maintained at financial institutions and, at times, balances may exceed federally insured limits of $250,000 per depositor. Historically, the Company has not experienced any losses related to these balances |
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Financial instruments | Financial instruments Financial instruments consist of cash and cash equivalents, trade accounts receivable, contract assets, accounts payable, accrued and other expenses and notes payable. Due to their short-term nature and market rates of interest, the carrying amounts of the financial instruments approximated fair value as of December 31, 2021 and 2020. |
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Accounts Receivable and Allowance for Doubtful Accounts | Accounts Receivable and Allowance for Doubtful Accounts Accounts receivable are customer obligations due under normal trade terms. Credit limits are initially established through a process of reviewing the financial history and stability of each customer and the Company performs continuing credit evaluations of its customers’ financial condition and generally does not require collateral. Included in accounts receivable at December 31, 2021 are unbilled receivables of approximately $0.4 million which are scheduled t o be invoiced in 2022. The Company’s policy is to maintain allowances for potential losses resulting from the inability of a portion of its customers to make required payments. The Company’s senior management reviews accounts receivable on a periodic basis to determine if any receivables may potentially be uncollectible. The Company includes any accounts receivable balances that it determines may likely be uncollectible, along with a general reserve for estimated probable losses based on historical experience, in its allowance for doubtful accounts. An amount is written off against the allowance after all attempts to collect the receivable have failed. |
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Inventory | Inventory The Company uses the
first-in, first-out method to track inventory, which is valued at the lower of cost or net realizable value. The Company regularly reviews inventory quantities on hand and records an inventory reserve for excess and/or obsolete inventory primarily based upon the estimated usage of its inventory, as well as other factors. |
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Property and Equipment | Property and Equipment Property and equipment are stated at cost and depreciated using the straight-line method over the estimated useful lives of the assets, which is generally to five years, except for leasehold improvements, which are depreciated over the shorter of the term of the lease, or useful life of the asset. |
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Goodwill | Goodwill In accordance with FASB Accounting Standards Codification (“ASC”) Topic 350-20, “Intangibles—Goodwill and Other” 350-20”), the Company tests goodwill for impairment on an annual basis and between annual tests if events or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. Factors the Company considers important, which could trigger an impairment of Goodwill, include the following:
The two reporting units within iCAD are its segments, Detection and Therapy. The Company records an impairment charge if such an assessment were to indicate that the fair value of a reporting unit was less than the carrying value. When the Company evaluates potential impairments outside of its annual measurement date, judgment is required in determining whether an event has occurred that may impair the value of goodwill or intangible assets. Fair values for the reporting units are based on a weighting of the income approach and the market approach. For purposes of the income approach, fair value is determined based on the present value of estimated future cash flows, discounted at an appropriate risk adjusted rate. The Company uses internal forecasts to estimate future cash flows and includes estimates of long-term future growth rates based on our most recent views of the long-term forecast for each segment. Accordingly, actual results can differ from those assumed in our forecasts. Discount rates are derived from a capital asset pricing model and by analyzing published rates for industries relevant to our reporting units to estimate the cost of equity financing. The Company uses discount rates that are commensurate with the risks and uncertainty inherent in the respective businesses and in our internally developed forecasts. In the market approach, the Company uses a valuation technique in which values are derived based on market prices of publicly traded companies with similar operating characteristics and industries. A market approach allows for comparison to actual market transactions and multiples. It can be somewhat limited in its application because the population of potential comparable publicly-traded companies can be limited due to differing characteristics of the comparative business and ours, as well as the fact that market data may not be available for divisions within larger conglomerates or non-public subsidiaries that could otherwise qualify as comparable, and the specific circumstances surrounding a market transaction (e.g., synergies between the parties, terms and conditions of the transaction, etc.) may be different or irrelevant with respect to our business. The Company corroborates the total fair values of the reporting units using a market capitalization approach; however, this approach cannot be used to determine the fair value of each reporting unit value. The blend of the income approach and market approach is more closely aligned to our business profile, including markets served and products available. In addition, required rates of return, along with uncertainties inherent in the forecast of future cash flows, are reflected in the selection of the discount rate. Equally important, under the blended approach, reasonably likely scenarios and associated sensitivities can be developed for alternative future states that may not be reflected in an observable market price. The Company assesses each valuation methodology based upon the relevance and availability of the data at the time the valuation is performed and weights the methodologies appropriately. The Company performed the annual impairment assessment at October 1, 2021 and compared the fair value of each reporting unit to its carrying value as of this date. The fair value of the Detection reporting unit exceeded the carrying value. Accordingly, no impairment of goodwill was recorded. The carrying values of the reporting units were determined based on an allocation of our assets and liabilities through specific allocation of certain assets and liabilities, to the reporting units and an apportionment of the remaining net assets based on the relative size of the reporting units’ revenues and operating expenses compared to the Company as a whole. The determination of reporting units also requires management judgment. |
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Long Lived Assets | Long Lived Assets In accordance with FASB ASC Topic 360 , “Property, Plant an d Equipment” (“ASC 360 ”), the Company assesses long-lived assets for impairment if events and circumstances indicate it is more likely than not that the fair value of the asset group is less than the carrying value of the asset group. ASC 360 -10 -35 uses “events and circumstances” criteria to determine when, if at all, an asset (or asset group) is evaluated for recoverability. Thus, there is no set interval or frequency for recoverability evaluation. In accordance with ASC 360 -10 -35 -21 the following factors are examples of events or changes in circumstances that indicate t h e carrying amount of an asset (asset group) may not be recoverable and thus is to be evaluated for recoverability.
In accordance with ASC 360-10-35-17, The Company did not record any impairment charges on its long-lived assets for the years ended December 31, 2021 or December 31, 2020. Intangible assets subject to amortization consist primarily of patents, technology intangibles, trade names, customer relationships and distribution agreements purchased in the Company’s previous acquisitions. These assets are amortized on a straight-line basis or the pattern of economic benefit over their estimated useful lives of 5 to 10 years. |
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Leases | Leases Per ASC 842, the Company determines if an arrangement contains a lease at inception. A lease is an operating or financing contract, or part of a contract, that conveys the right to control the use of an identified tangible asset for a period of time in exchange for consideration. At lease inception, the Company recognizes a lease liability equal to the present value of the remaining lease payments, and a right of use asset equal to the lease liability, subject to certain adjustments, such as for lease incentives. In determining the present value of the lease payments, the Company uses its incremental borrowing rate, determined by estimating the Company’s applicable, fully collateralized borrowing rate, with adjustment as appropriate for lease term. The lease term at the lease commencement date is determined based on the non-cancellable period for which the Company has the right to use the underlying asset, together with any periods covered by an extension option if the Company is reasonably certain to exercise that option. Right-of-use non-lease components, but the Company is accounting for the complete agreement under ASC 606 after determining that the non-lease component is the predominant component of these agreements. ASC 842 includes a number of reassessment and re-measurement requirements for lessees based on certain triggering events or conditions. There were no impairment indicators identified during the year ended December 31, 2021 that would require impairment testing of the Company’s right-of-use Certain of the Company’s leases include variable lease costs to reimburse the lessor for real estate tax and insurance expenses, and certain non-lease components that transfer a distinct service to the Company, such as common area maintenance services. The Company has elected to separate the accounting for lease components and non-lease components for real estate and equipment leases. |
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Stock-Based Compensation | Stock-Based Compensation The Company maintains stock-based incentive plans, under which it provides stock incentives to employees, directors and contractors. The Company grants to employees, directors and contractors, options to purchase common stock at an exercise price equal to the market value of the stock at the date of grant. The Company may grant restricted stock to employees and directors. The underlying shares of the restricted stock grant are not issued until the shares vest, and compensation expense is based on the stock price of the shares at the time of grant. The Company follows ASC 718, “Compensation – Stock Compensation” re-measured at every reporting period. As a result, compensation cost could vary significantly during the performance measurement period.The Company uses the Black-Scholes option pricing model to value stock options which requires extensive use of accounting judgment and financial estimates, including estimates of the expected term participants will retain their vested stock options before exercising them, the estimated volatility of its common stock price over the expected term, and the number of options that will be forfeited prior to the completion of their vesting requirements. The Company estimates forfeitures based on historical experience with pre-vested forfeitures. To the extent actual forfeitures differ from the estimate, the difference is recorded to compensation expense in the period of the forfeiture. Fair value of restricted stock is determined based on the stock price of the underlying option on the date of the grant. Application of alternative assumptions could produce significantly different estimates of the fair value of stock-based compensation and consequently, the related amounts recognized in the Consolidated Statements of Operations. |
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Revenue Recognition | Revenue Recognition In accordance with ASC 606, revenue is recognized when a customer obtains control of promised goods or services and the amount of revenue recognized reflects the consideration to which the Company expects to be entitled to receive in exchange for these goods or services and excludes any sales incentives or taxes collected from customers which are subsequently remitted to government authorities. The Company applies the following five steps to guide revenue recognition:
The Company recognizes revenue from its contracts with customers primarily from the sale of products and from the sale of services and supplies. Revenue is recognized when control of the promised goods or services is transferred to a customer, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. For iCAD’s typical product revenue, control typically transfers upon shipment as title and risk of loss have passed to the customer. Services and supplies are considered to be transferred as the services are performed or over the term of the service or supply agreement. The Company enters into contracts that can include various combinations of products and services, which are generally capable of being distinct and accounted for as separate performance obligations. Perpetual software license are accounted for as a single performance obligation and revenue is recognized at the point in time when ownership is transferred to the customer. Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by the Company from a customer, are excluded from revenue. Shipping and handling costs associated with outbound freight after control of a product has transferred to a customer are accounted for as fulfillment costs and are included in cost of revenue. The Company continues to provide for estimated warranty costs on original product warranties at the time of sale. Goods and Services Classifications Products . Product revenue consists of sales of cancer detection perpetual licenses, cancer therapy systems, cancer therapy applicators, cancer therapy disposable applicators and other accessories that are typically shipped with a cancer therapy system. The Company transfers control and recognizes a sale when the product is shipped from the manufacturing or warehousing facility to the customer. Service Contracts 12 months to 48 months. The Company typically receives payment at the inception of the contract and recognizes revenue on a straight-line basis over the term of the agreement. Supply and Source Usage Agreements . Revenue from supply and source usage agreements is recognized on a straight-line basis over the term of the supply or source agreement. Professional Services . Revenue from fixed fee service contracts is recognized on a straight-line basis over the term of the agreement. Revenue from professional service contracts entered into with customers on a time and materials basis is recognized over the term of the agreement in proportion to the costs incurred in satisfying the obligations under the contract. Other . Other revenue consists primarily of miscellaneous products and services. The Company transfers control and recognizes a sale when the installation services are performed or when the Company ships the product from the Company’s manufacturing or warehouse facility to the customer. Significant Judgments The Company’s contracts with customers may include promises to transfer multiple products and services to a customer and identifying distinct performance obligations that should be accounted for separately versus together may require significant judgment. For arrangements with multiple performance obligations, the Company allocates revenue to each performance obligation based on its relative standalone selling price. Judgment is required to determine the standalone selling price for each distinct performance obligation. The Company generally determines standalone selling prices based on the prices charged to customers and uses a range of amounts to estimate standalone selling prices when the Company sells each of the products and services separately and need to determine whether there is a discount that needs to be allocated based on the relative standalone selling prices of the various products and services. The Company typically has more than one range of standalone selling prices for individual products and services due to the stratification of those products and services by customers and circumstances. In these instances, the Company may use information such as the type of customer and geographic region in determining the range of standalone selling prices. The Company may provide credits or incentives to customers, which are accounted for as variable consideration when estimating the transaction price of the contract and amounts of revenue to recognize. The amount of variable consideration to include in the transaction price is estimated at contract inception using either the estimated value method or the most likely amount method based on the nature of the variable consideration. These estimates are updated at the end of each reporting period as additional information becomes available and revenue is recognized only to the extent that it is probable that a significant reversal of any amounts of variable consideration included in the transaction price will not occur. The Company provides for estimated warranty costs on original product warranties at the time of sale. Assets Recognized from the Costs to Obtain a Contract with a Customer The Company recognizes incremental costs of obtaining a contract with a customer as an asset if the Company expects the benefit of those costs to be longer than one year and as an expense when incurred if the amortization period of the asset that the Company otherwise would have recognized is one year or less. Right to Invoice Where applicable, the Company recognizes revenue from a contract with a customer in an amount that corresponds directly with the value to the customer of the Company’s performance completed to date and the amount to which the Company has a right to invoice. Sales and Other Similar Taxes The Company excludes sales taxes and similar taxes from the measurement of transaction price and ensures compliance w ith Significant Financing Component The Company does not adjust the promised amount of consideration for the effects of a significant financing component if the Company expects, at contract inception, that the period between when the entity transfers a promised good or service to a customer and when the customer pays for that good or service will be one year or less. Promised Goods or Services that are Immaterial in the Context of a Contract The Company assesses materiality of promised goods or services as performance obligations in the context of a contract and the Company does not aggregate and assess immaterial items at the entity level. When determining whether a good or service is immaterial in the context of a contract, the assessment will be made based on the application of ASC 606 at the contract level. The Company does not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which it recognizes revenue at the amount to which it has the right to invoice for services performed.
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Cost of Revenue | Cost of Revenue Cost of revenue consists of the costs of products purchased for resale, cost relating to service including costs of service contracts to maintain equipment after the warranty period, inbound freight and duty, manufacturing, warehousing, material movement, inspection, scrap, rework, depreciation and
in-house product warranty repairs, amortization of acquired technology and any applicable medical device tax. |
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Warranty Costs | Warranty Costs The Company provides for the estimated cost of standard product warranty against defects in material and workmanship based on historical warranty trends, including the cost of product returns during the warranty period. Warranty costs have not historically been material to the Company’s consolidated financial statements. |
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Engineering and Product Development Costs | Engineering and Product Development Costs Engineering and product development costs relate to research and development efforts including Company sponsored clinical trials are expensed as incurred. |
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Advertising Costs | Advertising Costs The Company expenses advertising costs as incurred. Advertising expense for the years ended December 31, 2021, 2020 and 2019 was approximately $689,000, $274,000, and $1,101,000, respectively. |
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Income Taxes | Income Taxes The Company follows the liability method under ASC Topic 740 “
Income Taxes |
Fair Value Measurements (Tables) |
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Assets and Liabilities which are Measured at Fair Value on a Recurring Basis | The following table sets forth the Company’s assets which are measured at fair value on a recurring basis by level within the fair value hierarchy (in thousand):
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Schedule of Reconciliation of Changes In Fair Value of Convertible Debentures | The following is a roll forward of the Company’s Level 3 instruments for the years ended December 31, 2021 and 2020:
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Revenue (Tables) |
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Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue from Contract with Customer [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenues Disaggregated by Major Good or Service Line, Timing of Revenue Recognition, and Sales Channel, Reconciled to Our Reportable Segments | The following tables presents the Company’s revenues disaggregated by major good or service line, timing of revenue recognition and sales channel, reconciled to its reportable segments (in thousands).
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Summary of Receivables, Contract Assets and Contract Liabilities from Contracts with Customers | The following table provides information about receivables, current and non-current contract assets, and contract liabilities from contracts with customers (in thousands).
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Summary of Changes in Deferred Revenue | Changes in deferred revenue from contracts with customers were as follows (in thousands):
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Schedule of Changes of Capitalized Costs to Obtain Contract | Changes in the balance of capitalized costs to obtain a contract were as follows (in thousands):
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Net Loss per Common Share (1o) (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Calculation of Net Loss Per Share | A summary of the Company’s calculation of net loss per share is as follows (in thousands, except per share amounts):
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Schedule of Anti-dilutive Shares Excluded from Computation of Diluted Net Loss Per Share | The following table summarizes the number of shares of common stock for convertible securities, warrants and restricted stock that were not included in the calculation of diluted net loss per share because such shares are antidilutive:
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Allowance for Doubtful Accounts (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financing Receivable, Current, Allowance for Credit Loss [Table Text Block] | The rollforward of the Company’s allowance for doubtful accounts for the years ended December 31 is as follows (in thousands):
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Inventories (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Current Inventory | Inventory balances at December 31, 2021 and 2020 were as follows (in thousands):
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Goodwill and Intangible assets (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Intangible Assets |
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Schedule of Expected Amortization Expense | Estimated remaining amortization of the Company’s intangible assets is as follows (in thousands):
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Accrued and Other Expenses (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Payables and Accruals [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accrued and Other Expenses | Accrued and other expenses consist of the following at December 31 (in thousands):
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Leases (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Components of Lease Expense |
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Summary of Detained Information of Lease Liabilities | Maturities of the Company’s lease liabilities as of December 31, 2021 were as follows (in thousands):
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Stockholders' Equity (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Federal Home Loan Banks [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Stock Option Activity for all Stock Option Plans |
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Stock-Based Compensation Expense Including Options and Restricted Stock by Category | The Company’s stock-based compensation expense, including options and restricted stock by category is as follows (amounts in thousands):
|
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Options Granted under Company's Stock Incentive Plans, Valuation Assumptions and Fair Values | Options granted under the stock incentive plans were valued utilizing the Black-Scholes model using the following assumptions and had the following fair values:
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Summary Of Intrinsic Values Of Option And Closing Market Price | Intrinsic values of options (in thousands) and the closing market price used to determine the intrinsic values are as follows: Intrinsic value of stock options
|
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Summary of Restricted Stock Activity for All Equity Incentive Plans | A summary of unvested restricted stock activity for the Stock Plans is follows:
|
Income Taxes (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of Income Tax Expense | The components of income tax expense for the years ended December 31 are as follows (in thousands):
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Summary of Effective and the Federal Statutory Income Tax Rate | A summary of the differences between the Company’s effective income tax rate and the Federal statutory income tax rate for the years ended December 31 is as follows:
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Deferred Tax Assets (Liabilities) | The Company has fully reserved the net deferred tax assets, as it is more likely than not that the deferred tax assets will not be utilized. Deferred tax assets (liabilities) are composed of the following at December 31, 2021 and 2020 (in thousands):
|
Segment Reporting (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Segment Revenues, Gross Profit, Segment Operating Income or Loss and Reconciliation of Segment Operating Income or Loss to GAAP Loss | Segment revenues, gross profit, segment operating income or loss, and a reconciliation of segment operating income or loss to GAAP loss before income tax is as follows (in thousands):
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Summary of Segment Depreciation and Amortization Included in Segment Operating Income (Loss) | Segment depreciation and amortization included in segment operating income (loss) is as follows (in thousands):
|
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Summary of Concentration of Revenue by Geographic Area |
Significant export sales in Europe are as follows:
|
Notes Payable (Tables) |
12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Key Inputs to Simulation Model Utilized to Estimate Fair Value of Convertible Debentures | The Company notes that the key inputs to the simulation model that were utilized to estimate the fair value of the Convertible Debentures at each valuation date included:
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Schedule of Fair Value and Principal Value of Convertible Debentures | The fair value and principal value of the Convertible Debentures as of December 31, 2019 and the Conversion Date was as follows (in thousands):
|
Organization and Business - Additional Information (Detail) |
12 Months Ended |
---|---|
Dec. 31, 2021
Segment
| |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of Operating Segments | 2 |
Fair Value Measurements - Assets and Liabilities which are Measured at Fair Value on a Recurring Basis (Detail) - Fair Value, Measurements, Recurring [Member] - USD ($) $ in Thousands |
Dec. 31, 2021 |
Dec. 31, 2020 |
---|---|---|
Assets | ||
Total Assets | $ 30,573 | $ 24,635 |
Money market accounts | ||
Assets | ||
Total Assets | 30,573 | 24,635 |
Level 1 [Member] | ||
Assets | ||
Total Assets | 30,573 | 24,635 |
Level 1 [Member] | Money market accounts | ||
Assets | ||
Total Assets | $ 30,573 | $ 24,635 |
Fair Value Measurements - Schedule of Reconciliation of Changes In Fair Value of Convertible Debentures (Detail) - Convertible Debentures [Member] - Level 3 [Member] $ in Thousands |
12 Months Ended |
---|---|
Dec. 31, 2020
USD ($)
| |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |
Beginning balance | $ 13,642 |
Issuances | 0 |
Fair value adjustments | 7,522 |
Conversion | (21,164) |
Ending balance | $ 0 |
Fair Value Measurements - Additional Information (Detail) - USD ($) |
Dec. 31, 2021 |
Dec. 31, 2020 |
---|---|---|
Level 3 [Member] | ||
Fair Value Disclosures [Line Items] | ||
Assets Fair Value Disclosure Nonrecurring Loss | $ 0 | $ 0 |
Revenue - Summary of Receivables, Contract Assets and Contract Liabilities from Contracts with Customers (Detail) - USD ($) $ in Thousands |
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
---|---|---|---|
Contract with Customer, Asset and Liability [Abstract] | |||
Receivables, which are included in ‘Trade accounts receivable' | $ 8,891 | $ 10,027 | |
Current contract assets, which are included in "Prepaid and other assets" | 1,895 | 481 | |
Non-current contract assets, which are included in "other assets" | 844 | 1,434 | |
Contract liabilities, which are included in "Deferred revenue" | $ 6,093 | $ 6,384 | $ 5,604 |
Revenue - Summary of Changes in Deferred Revenue from Contracts with Customers (Detail) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
|
Deferred Revenue Disclosure [Abstract] | ||
Balance at beginning of period | $ 6,384 | $ 5,604 |
Deferral of revenue | 12,315 | 11,212 |
Recognition of deferred revenue | (12,606) | (10,432) |
Balance at end of period | $ 6,093 | $ 6,384 |
Revenue - Schedule of Changes of Capitalized Costs to Obtain Contract (Detail) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
|
Capitalized Contract Cost, Net [Abstract] | ||
Balance at beginning of period | $ 406 | $ 379 |
Deferral of costs to obtain a contract | 249 | 157 |
Recognition of costs to obtain a contract | (353) | (130) |
Balance at end of period | $ 302 | $ 406 |
Revenue - Additional Information (Detail) $ in Millions |
12 Months Ended |
---|---|
Dec. 31, 2021
USD ($)
| |
Revenue From Contract With Customer [Line Items] | |
Unearned amount to recognize in 2022 | $ 7.1 |
Unearned amount to recognize in 2023 | 1.2 |
Unearned amount to recognize in 2024 | 1.0 |
Unearned amount to recognize in 2025 | $ 1.0 |
Net Loss per Common Share (1o) - Calculation of Net Loss Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items] | |||
Net loss available to common shareholders | $ (11,245) | $ (17,610) | $ (13,551) |
Basic shares used in the calculation of earnings per share | 24,778 | 22,140 | 18,378 |
Effect of dilutive securities: | |||
Diluted shares used in the calculation of earnings per share | 24,778 | 22,140 | 18,378 |
Net loss per share : | |||
Basic | $ (0.45) | $ (0.80) | $ (0.74) |
Diluted | $ (0.45) | $ (0.80) | $ (0.74) |
Net Loss per Common Share (1o) - Schedule of Anti-dilutive Shares Excluded from Computation of Diluted Net Loss Per Share (Detail) - shares |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Common stock options, warrants and restricted stock | 2,487,386 | 1,898,673 | 3,444,071 |
Stock Options [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Common stock options, warrants and restricted stock | 2,486,511 | 1,869,507 | 1,550,662 |
Restricted Stock [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Common stock options, warrants and restricted stock | 875 | 29,166 | 150,909 |
Convertible Debentures [Member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Common stock options, warrants and restricted stock | 1,742,500 |
Inventories - Schedule of Current Inventory (Detail) - USD ($) $ in Thousands |
Dec. 31, 2021 |
Dec. 31, 2020 |
---|---|---|
Inventory Disclosure [Abstract] | ||
Raw materials | $ 2,962 | $ 1,538 |
Work in process | 173 | 76 |
Finished Goods | 1,279 | 1,774 |
Inventory Gross | 4,414 | 3,388 |
Inventory Reserve | (243) | (244) |
Inventory Net | $ 4,171 | $ 3,144 |
Goodwill and Intangible assets - Schedule of Expected Amortization Expense (Detail) - USD ($) $ in Thousands |
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
---|---|---|---|
Accounting Policies [Abstract] | |||
2022 | $ 217 | ||
2023 | 186 | ||
2024 | 103 | ||
2025 | 103 | ||
2026 | 74 | ||
Total amortizable intangible assets, net | $ 683 | $ 889 | $ 1,183 |
Goodwill and Intangible assets - Additional Information (Detail) - USD ($) |
12 Months Ended | |||
---|---|---|---|---|
Oct. 01, 2021 |
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Good will And Intangible Assets Disclosure [Line Items] | ||||
Goodwill | $ 8,362,000 | $ 8,362,000 | ||
Additions to goodwill | 0 | 0 | ||
Goodwill impairment | $ 0 | 0 | 0 | |
Other changes to goodwill | 0 | 0 | ||
Amortization | 230,000 | 309,000 | $ 377,000 | |
ICAD Detection [Member] | ||||
Good will And Intangible Assets Disclosure [Line Items] | ||||
Goodwill | $ 8,362,000,000 | $ 8,362,000,000 |
Accrued and Other Expenses - Accrued Expenses (Detail) - USD ($) $ in Thousands |
Dec. 31, 2021 |
Dec. 31, 2020 |
---|---|---|
Payables and Accruals [Abstract] | ||
Accrued salary and related expenses | $ 2,016 | $ 3,654 |
Accrued accounts payable | 2,838 | 2,405 |
Accrued professional fees | 497 | 598 |
Other accrued expenses | 291 | 382 |
Accrued Expenses Total | $ 5,642 | $ 7,039 |
Leases - Additional Information (Detail) - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Oct. 31, 2021 |
Dec. 31, 2021 |
|
Lessee, Lease, Description [Line Items] | ||
Lease incentives amount | $ 110,160 | |
Increase in lease liability | 79,000 | |
Increase in right of use asset | $ 79,000 | |
Nashua [Member] | ||
Lessee, Lease, Description [Line Items] | ||
Extended lease term of warehouse | 2024 |
Leases - Schedule of Components of Lease Expense (Detail) - Accounting Standards Update 2016-02 [Member] - USD ($) $ in Thousands |
12 Months Ended | |
---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
|
Lessee, Lease, Description [Line Items] | ||
Operating lease cost - Right of Use | $ 862 | $ 884 |
Operating lease cost - Variable Costs | 186 | 165 |
Finance lease costs | ||
Total | 1,048 | 1,049 |
Cash paid for operating cash flows from operating leases | $ 919 | $ 909 |
Weighted-average remaining lease term of operating leases (in years) | 1 year 3 months 29 days | 2 years 2 months 15 days |
Weighted-average discount rate for operating leases | 5.50% | 5.60% |
Leases - Summary of Detained Information of Lease Liabilities (Detail) - USD ($) $ in Thousands |
Dec. 31, 2021 |
Dec. 31, 2020 |
---|---|---|
Leases [Abstract] | ||
2022 | $ 931 | |
2023 | 253 | |
2024 | 16 | |
Total | 1,200 | |
Less: imputed interest | (45) | |
Total lease liabilities | 1,155 | |
Less: current portion of lease liabilities | (889) | |
Total lease liabilities | $ 266 | $ 1,075 |
Operating Lease, Liability, Statement of Financial Position [Extensible List] | Total lease liabilities |
Stockholders' Equity - Summary of Stock Option Activity for all Stock Option plan (Detail) - $ / shares |
1 Months Ended | 12 Months Ended | |||
---|---|---|---|---|---|
Dec. 17, 2020 |
Apr. 27, 2020 |
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Share-based Payment Arrangement [Abstract] | |||||
Beginning balance | 1,869,507 | 1,550,662 | |||
Granted | 865,938 | 563,502 | |||
Exercised | (470,704) | (1,562,500) | (168,450) | (155,149) | |
Forfeited | (80,484) | (89,508) | |||
Ending Balance | 2,486,511 | 1,869,507 | 1,550,662 | ||
weighted Average, Beginning Balance | $ 5.91 | $ 4.33 | |||
Granted | 16.33 | 10.09 | |||
Exercised | 6.10 | 4.70 | |||
Forfeited | 13.74 | 2.51 | |||
Weighted Average, Ending Balance | $ 9.27 | $ 5.91 | $ 4.33 | ||
Weighted Average Remaining Contractual Term, Outstanding | 5 years 5 months 1 day | 6 years | |||
Exercisable, Number of Shares | 1,619,855 | 1,540,287 | 881,461 | ||
Exerciable, Weighted Average Exercise Price | $ 6.47 | $ 5.55 | $ 4.43 |
Stockholders' Equity - Options Granted under Company's Stock Incentive Plans, Valuation Assumptions and Fair Values (Detail) - Stock Option [Member] - $ / shares |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Average rish-free interest rate | 0.42% | 0.65% | 1.88% |
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Expected life | 3 years 6 months | 3 years 6 months | 3 years 6 months |
Weighted average fair value | $ 7.22 | $ 4.37 | $ 2.34 |
Maximum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected volatility | 67.40% | 66.04% | 54.23% |
Minimum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected volatility | 65.57% | 50.17% | 50.01% |
Stockholders' Equity - Summary of Intrinsic Values of Options (Detail) - USD ($) $ / shares in Units, $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Share-based Payment Arrangement [Abstract] | |||
Outstanding | $ 3,820 | $ 13,626 | $ 5,465 |
Exercisable | 3,730 | 11,786 | 3,067 |
Exercised | $ 1,453 | $ 1,037 | $ 509 |
Company's stock price at December 31 | $ 7.20 | $ 13.20 | $ 7.77 |
Stockholders' Equity - Summary of Restricted Stock Activity for All Equity Incentive Plans (Detail) - Restricted Stock [Member] - shares |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Beginning outstanding balance | 29,166 | 150,909 | 423,202 |
Granted | 22,488 | 0 | 15,990 |
Vested | (50,779) | (118,077) | (197,730) |
Forfeited | 0 | (3,666) | (90,553) |
Ending outstanding balance | 875 | 29,166 | 150,909 |
Allowance for Doubtful Accounts - Schedule of Allowance for Doubtful Accounts (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Receivables [Abstract] | |||
Balance at beginning of period | $ 111 | $ 136 | $ 177 |
Additions charged to costs and expenses | 167 | 94 | 62 |
Reductions | (10) | (119) | (103) |
Balance at end of period | $ 268 | $ 111 | $ 136 |
Income Taxes - Components of Income Tax Expense (Detail) - USD ($) $ in Thousands |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Current provision: | |||
Federal | |||
State | 0 | $ 37 | $ 42 |
Foreign | 0 | ||
Current provision (benefit), Total | 0 | 37 | 42 |
Deferred provision: | |||
Federal | 1 | 1 | 1 |
State | 0 | ||
Foreign | 0 | ||
Deferred provision, Total | 1 | 1 | 1 |
Total | $ 1 | $ 38 | $ 43 |
Income Taxes - Summary of Effective and the Federal Statutory Income Tax Rate (Detail) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Schedule Of Income Tax Expense [Line Items] | |||
Federal statutory rate | 21.00% | 21.00% | 21.00% |
State income taxes, net of federal benefit | 5.20% | 2.40% | 1.70% |
Net state impact of deferred rate change | 0.80% | (0.70%) | (0.20%) |
Stock compensation expense | 1.30% | 0.90% | (10.70%) |
Other permanent differences | (0.10%) | (0.10%) | 0.00% |
Change in valuation allowance | (24.40%) | (13.40%) | (6.00%) |
Tax credits | 3.10% | 1.40% | 2.80% |
Accrual to tax return | (1.40%) | 0.00% | 1.30% |
FV Mark to market on convertible notes | 0.00% | (9.00%) | (10.40%) |
Foreign Rate Differential | 0.00% | 0.00% | 0.20% |
True Ups—NOL Expiration/162(m) limits | (5.40%) | (2.80%) | 0.00% |
Effective income tax | 0.10% | (0.30%) | (0.30%) |
Income Taxes - Deferred Tax Assets (Liabilities) (Detail) - USD ($) $ in Thousands |
Dec. 31, 2021 |
Dec. 31, 2020 |
---|---|---|
Income Tax Disclosure [Abstract] | ||
Inventory (Section 263A) | $ 276 | $ 248 |
Inventory reserves | 61 | 60 |
Receivable reserves | 67 | 28 |
Other accruals | 854 | 1,081 |
Deferred revenue | 107 | 75 |
Accumulated depreciation/amortization | 8 | 37 |
Stock options | 795 | 459 |
Developed technology | 1,242 | 1,449 |
Tax credits | 4,176 | 3,859 |
NOL carryforward | 38,383 | 36,078 |
Lease liability | 290 | 415 |
Deferred tax assets | 46,259 | 43,789 |
Valuation allowance | (45,994) | (43,356) |
Right of Use Asset | (265) | (433) |
Goodwill tax amortization | (5) | (4) |
Deferred tax liability | $ (5) | $ (4) |
Segment Reporting - Summary of Segment Depreciation and Amortization Included in Segment Operating Income (Loss) (Detail) - USD ($) |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
Dec. 31, 2019 |
|
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Depreciation | $ 327,000 | $ 268,000 | $ 297,000 |
Amortization | 230,000 | 309,000 | 377,000 |
Detection [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Depreciation | 123,000 | 115,000 | 103,000 |
Amortization | 158,000 | 164,000 | 240,000 |
Therapy [Member] | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Depreciation | 129,000 | 124,000 | 166,000 |
Amortization | $ 73,000 | $ 128,000 | $ 128,000 |
Commitments and Contingencies - Additional Information (Detail) - USD ($) |
3 Months Ended | 12 Months Ended | |||
---|---|---|---|---|---|
Apr. 13, 2021 |
Jun. 30, 2021 |
Dec. 31, 2021 |
Jan. 30, 2017 |
Dec. 31, 2016 |
|
Schedule Of Leases [Line Items] | |||||
Purchase obligations to suppliers for future product deliverables | $ 7,200,000 | ||||
Minimum annual royalty payment | 250,000 | ||||
Fair value of patent license | $ 100,000 | ||||
Patent license, Estimated Amortizable Life | 4 years | ||||
Minimum royalty obligations | $ 200,000 | ||||
Cash paid on litigation | $ 85,000 | ||||
Escrowed amount payable by other party | $ 50,000 | ||||
Litigation Settlement, Expense | $ 93,000 | ||||
VersaVue Software and DynaCAD Product and Related Assets [Member] | Asset Purchase Agreement [Member] | |||||
Schedule Of Leases [Line Items] | |||||
Sale and transfer of intangible assets | $ 3,200,000 | ||||
Holdback reserve related to sale and transfer of intangible assets | $ 350,000 | ||||
Proceeds from sale and transfer of intangible assets | $ 2,900,000 |
Notes Payable - Additional Information (Detail) |
12 Months Ended | |||||||
---|---|---|---|---|---|---|---|---|
Apr. 27, 2021
USD ($)
|
Mar. 30, 2020
USD ($)
|
Dec. 31, 2021
USD ($)
customer
$ / shares
|
Dec. 31, 2020
USD ($)
shares
|
Dec. 31, 2019
USD ($)
|
Feb. 21, 2020
USD ($)
|
Feb. 21, 2019
USD ($)
|
Aug. 07, 2017
USD ($)
|
|
Debt Instrument [Line Items] | ||||||||
Loss from fair value of the convertible debentures | $ 7,500,000 | |||||||
Final payment of loan | $ 510,000 | |||||||
Gain (Loss) on Extinguishment of Debt | (386,000) | (341,000) | $ 0 | |||||
Reclassified the fair value of convertible debentures | 13,642,000 | $ 21,164,000 | $ 21,200,000 | |||||
Repayments of Lines of Credit | $ 7,354,283,000 | $ 2,775,000 | $ 1,000,000 | |||||
Silicon Valley Bank [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Termination Loans | 114,000 | |||||||
Gain (Loss) on Extinguishment of Debt | $ 341,000,000 | |||||||
Silicon Valley Bank [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Final payment of loan | 185,000 | |||||||
Termination Loans | 114,000 | |||||||
Other Costs | 10,000 | |||||||
Unamortized closing costs | 42,000 | |||||||
Western Alliance Bank [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Gain (Loss) on Extinguishment of Debt | 386,000 | |||||||
Western Alliance Bank [Member] | Debt Prepayment Cost [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt prepayment cost | 140,000 | |||||||
Western Alliance Bank [Member] | Final Payment Of Loan [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Final payment of loan | 122,000 | |||||||
Western Alliance Bank [Member] | Termination Loans [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Termination Loans | 65,000 | |||||||
Western Alliance Bank [Member] | Unamortized Debt Issuance Expense [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Unamortized closing costs | 58,000 | |||||||
Convertible Debt [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal amount | $ 7,000,000.0 | |||||||
Debt conversion, conversion price per share | $ / shares | $ 4.00 | |||||||
Convertible debenture Number of instrumnts converted | customer | 1,742,500 | |||||||
Shares issued up on conversion | shares | 1,816,466 | |||||||
Convertible Debt [Member] | Make Whole Provision [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Aggregate principal amount | $ 697,000 | |||||||
Convertible debenture Number of instrumnts converted | customer | 76,966 | |||||||
Term Loan A [Member] | Silicon Valley Bank [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Credit facility | 7,000,000.0 | $ 6,000,000.0 | ||||||
Revolving Credit Facility [Member] | Silicon Valley Bank [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Credit facility | $ 5,000,000.0 | $ 4,000,000.0 |
Notes Payable - Schedule of Fair Value and Principal Value of Convertible Debentures (Detail) - USD ($) $ in Thousands |
Feb. 21, 2020 |
Dec. 31, 2019 |
Feb. 21, 2019 |
---|---|---|---|
Debt Disclosure [Abstract] | |||
Fair value, in accordance with fair value option | $ 21,164 | $ 13,642 | $ 21,200 |
Principal value outstanding | $ 6,970 | $ 6,970 |
Employee Benefit Plan - Additional Information (Detail) - 401 k Plan [Member] - USD ($) $ in Millions |
12 Months Ended | |
---|---|---|
Dec. 31, 2021 |
Dec. 31, 2020 |
|
Defined Benefit Plan Disclosure [Line Items] | ||
Defined benefit plan,Percentage of Compensation elect to contribute by participant | 90.00% | |
Defined benefit plan,Employer matching contribution percent of every dollar contributed | 100.00% | |
Defined benefit plan,Employer matching contributions not exceed the percent of participant's eligible wages | 3.00% | |
Defined benefit plan,Employer contributed amount | $ 5 | $ 5 |
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