Capitalization and Equity Structure
|12 Months Ended|
Dec. 31, 2018
|Stockholders' Equity Note [Abstract]|
|Capitalization and Equity Structure||
Capitalization and Equity Structure
The Company’s authorized capital stock at December 31, 2018 consisted of 141,429 shares of common stock and 10,000 shares of preferred stock. At December 31, 2018, 62,963 shares of common stock were issued and outstanding and no shares of preferred stock were issued and outstanding.
The holders of outstanding shares of common stock are entitled to receive dividends out of assets or funds legally available for the payment of dividends at such times and in such amounts as the Board of Directors may determine. Holders of common stock are entitled to one vote for each share held on all matters submitted to a vote of stockholders. There is no cumulative voting for the election of directors. The common stock is not entitled to pre-emptive rights and is not subject to conversion or redemption. Upon liquidation, dissolution or winding up of the Company, the assets legally available for distribution to stockholders are distributable ratably among the holders of the common stock after payment of liquidation preferences, if any, on any outstanding payment of other claims of creditors. Each outstanding share of common stock is duly and validly issued, fully paid, and non-assessable.
Reverse Stock Split
After the close of the stock market on May 4, 2016, the Company effected a 1-for-7 reverse split of its common stock. As a result, all amounts included in this filing with respect to shares of the Company’s common stock issued prior to May 4, 2016 have been retroactively reduced by a factor of seven and all per share amounts with respect to shares of the Company’s common stock issued prior to May 4, 2016 have been increased by a factor of seven, with the exception of our common stock par value. Amounts affected include common stock outstanding on May 4, 2016, including the issuance of new shares of common stock as a result of the conversion of preferred stock and the exercise of stock options and warrants prior to such date.
In August 2018, the Company entered into a Controlled Equity OfferingSM Sales Agreement, or ATM Agreement, with Cantor Fitzgerald & Co., or the Agent, under which the Company may issue and sell shares of its common stock, from time to time, to or through the Agent, by methods deemed to be an “at the market offering.” Shares having an aggregate offering price of up to $25,000 may be offered and sold under the prospectus and prospectus supplement filed with the SEC related to such offering, or the ATM Prospectus. For the year ended December 31, 2018, the Company sold 2,032 shares of common stock under the ATM Agreement at an average price of $2.39 per share, for aggregate proceeds of $4,446, net of commission and issuance costs, to the Company. As of December 31, 2018, approximately $20,134 aggregate offering price of the Company's common stock remained available for issuance pursuant to the ATM Prospectus.
August 2017 Rights Offering
In August 2017, the Company commenced a $34,000 rights offering or Rights Offering to its existing stockholders and certain warrant holders of the Company on the record date of August 10, 2017. The subscription price was $1.00 per share and each subscription right provided 1.1608 shares of the Company’s common stock plus an oversubscription right, subject to availability. Concurrent with the rights offering, the Company entered into a purchase agreement or the Backstop Investment Agreement with Puissance Cross-Border Opportunities II LLC, or the Backstop Investor. The Backstop Investment Agreement contemplated the purchase of any unsubscribed shares from the Rights Offering under the same terms, subject to a cap of 40% of the Company’s total outstanding shares. Under the Backstop Investment Agreement, 20,535 shares of our common stock or Puissance Shares were issued to the Backstop Investor. The Puissance Shares were issued in an unregistered offering, and were subsequently registered by the Company for resale to the public pursuant to a registration rights agreement entered into with the Backstop Investor.
In connection with the Rights Offering, the Company entered into a Warrant Repurchase and Amendment Agreement, or Repurchase Agreement, with all of the holders of the warrants issued in April 2017, or April 2017 Warrants. Under the Repurchase Agreement, the Company agreed to repurchase the April 2017 Warrants from each holder thereof at a price of $1.23 per underlying share. The Company’s obligation to repurchase the warrants was subject to the warrant holder’s participation in the Rights Offering. The Repurchase Agreement also permitted the holders of the April 2017 Warrants to use all or a portion of the consideration received as a result of the Company’s repurchase of the April 2017 Warrants to pay the subscription price for the exercise of their subscription rights in the Rights Offering. Upon the closing of the Rights Offering the Company repurchased April 2017 Warrants exercisable for 1,866 shares and applied consideration of $2,245 to the subscribed shares in the Rights Offering.
The Company sold an aggregate of 13,465 shares of its common stock to existing stockholders and certain warrant holders, including the holders of the April 2017 Warrants, in the Rights Offering for gross proceeds of $13,465, which after deducting expenses, totaling approximately $286, resulted in net proceeds of $13,179 from the Rights Offering; and sold the Puissance Shares to the Backstop Investor pursuant to the Backstop Investment Agreement for gross proceeds of $20,535. Of the $286 in direct issuance costs, warrants with a fair value of $131 have been issued to an information agent. The warrants are classified as equity in the statement of stockholders’ equity.
April 2017 Common Stock Offering
In April 2017, the Company sold in a registered direct offering, or the 2017 Registered Direct Offering, an aggregate of 3,732 shares of its common stock, par value $0.001 per share, and warrants to purchase 1,866 shares of common stock. The aggregate net proceeds of the transaction were approximately $10,919.
The Company may issue shares of preferred stock from time to time in one or more series, each of which will have such distinctive designation or title as shall be determined by its Board of Directors and will have such voting powers, full or limited, or no voting powers, and such preferences and relative, participating, optional or other special rights and such qualifications, limitations or restrictions thereof, as shall be stated in such resolution or resolutions providing for the issue of such class or series of preferred stock as may be adopted from time to time by the Board of Directors.
Warrant share activity for the year ended December 31, 2018 was as follows:
Information Agent Warrants
In September 2017, in connection with the Rights Offering in August of 2017, the Company issued warrants to purchase 200 shares of the Company’s common stock with an exercise price of $1.50 to an information agent or the Information Agent Warrants. The Information Agent Warrants became exercisable immediately upon issuance. These warrants were recorded in stockholders’ equity on the Company’s consolidated balance sheet.
April 2017 Warrants
In April 2017, in connection with the 2017 Registered Direct Offering, the Company issued the April 2017 Warrants to purchase 1,866 shares of the Company’s common stock with an exercise price of $4.10 per share. The April 2017 Warrants were to become exercisable six months following the issuance date and were to expire five years from the date they became exercisable. The April 2017 Warrants contained a put-option provision. Under this provision, while the April 2017 Warrants were outstanding, if the Company entered into a Fundamental Transaction, defined as a merger, consolidation or similar transaction, the Company or any successor entity would, at the option of each warrant holder, exercisable at any time within 30 days after the consummation of the Fundamental Transaction, purchase the warrant from the holder exercising such option by paying to the holder an amount of cash equal to the value of the remaining unexercised portion of such holder’s warrant on the date of the consummation of the Fundamental Transaction, calculated using the Black-Scholes Model. Because of this put-option provision, a portion of the proceeds from the sale of common stock in the 2017 Registered Direct Offering was recorded as a warrant liability equal to the fair value of the warrants on the date of issuance and the April 2017 Warrants were marked to market at each reporting date. Issuance costs allocated to the April 2017 Warrants were $185 and were expensed as financing costs on the date of issuance. All of the issued and outstanding April 2017 Warrants were repurchased at a price of $1.23 per underlying share, as a result of the Rights Offering. As of December 31, 2018, none of the April 2017 Warrants remained outstanding.
In December 2015, the Company issued warrants to purchase 2,122 shares with an exercise price of $3.74 per share, or the 2015 Warrants. The 2015 Warrants contain a put-option provision. Under this provision, while the 2015 Warrants are outstanding, if the Company enters into a Fundamental Transaction, defined as a merger, consolidation or similar transaction, the Company or any successor entity will, at the option of each warrant holder, exercisable at any time within 30 days after the consummation of the Fundamental Transaction, purchase the warrant from the holder exercising such option by paying to the holder an amount of cash equal to the value of the remaining unexercised portion of such holder’s warrant on the date of the consummation of the Fundamental Transaction, calculated using the Black-Scholes Model. Because of this put-option provision, the 2015 Warrants are classified as a liability and are marked to market at each reporting date. During the years ended December 31, 2016 and 2017, 488 shares and 30 shares, respectively, of the 2015 warrants, were exercised. None of the 2015 Warrants were exercised during the year ended December 31, 2018.
The warrant liability is measured at fair value using certain estimated inputs, which are classified within Level 3 of the valuation hierarchy. These values are subject to a significant degree of judgment on our part. The Company’s common stock price represents a significant input that affects the valuation of the warrants.
The Company estimated the fair value of the warrant liability by using a Black-Scholes Model. The following assumptions were used in the Black-Scholes Model to measure the fair value of the 2015 Warrants as of the years ended:
2014 PPO and Merger Warrants and Pre-Merger Warrants
On January 15, 2014, a wholly-owned subsidiary of Ekso Bionics Holdings, Inc. named Ekso Acquisition Corp. merged with and into Ekso Bionics, Inc., or the Merger. Concurrently with the closing of the Merger and in contemplation of the Merger, the Company closed a private placement offering, or PPO, in which it issued warrants to purchase a total of 5,151 shares of common stock of which 4,329 were at an exercise price of $14.00 per share, and the balance of which were at an exercise price of $7.00 per share. The aforementioned warrants expired January 14, 2019.
Warrants to purchase preferred stock of Ekso Bionics Inc. outstanding prior to the Merger were converted into warrants to purchase 89 shares of common stock of the Company in connection with the Merger, or the Merger Warrants. As of December 31, 2018, there remained Merger Warrants to purchase 88 shares of the Company’s common stock outstanding, with the following terms: (1) the Merger Warrants expire on various dates from June 1, 2022 to August 30, 2023; (2) the Merger Warrants have an exercise price of $9.66 per share; and (3) at the option of the holder, the Merger Warrants may be exercised on a “cashless exercise” basis in which shares are retained to cover the exercise price based on the market value of the Company’s common stock on the date of exercise.
The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef